Crude oil prices plummet to 13-year low

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Crude oil prices plummeted Wednesday to under $27 dollars a barrel, the lowest level since 2003.

For consumers filling up their gas tanks, the low prices have meant more money in their pockets.

"Before it was like $100 to fill my big truck up here. And now it's about $60 so almost half," said Steven Rundle, who was filling his pickup truck in Alameda.

Lower oil prices, though have driven the stock market down, which worries those who have an eye on their retirement portfolios.

"I'm a little bit nervous because it's actual money that you see," said Jason Hung of Oakland, who has a 401(k) account through his work at an airline.

Crude oil prices have dropped 70 percent since the last peak in June 2014. That drop has hit the energy industry hard.

Chevron, based in San Ramon saw a 3-percent drop in its stock price Wednesday, bad news for the Bay Area company that already announced last fall that the oil price plunge is prompting thousands of layoffs.

"These really low oil prices have damaged these energy companies," said economist Jim Wilcox, a UC Berkeley Haas Business School professor.

Wilcox says it isn't just energy companies losing money. Banks such as Wells Fargo, Bank of America, and Citibank have provided millions of dollars in loans for oil exploration and new technologies.

"A lot of these energy companies are going to have real trouble paying back all of those loans. And the banks know it," Wilcox said.

Wilcox says increased regulation, however, following the mortgage meltdown, now requires banks to have larger cushions to protect against bad loans, a measure aimed at reducing the impact to the larger economy.

"Banks are much stronger now. They have much more capital. They have a lot more reserves to rely on," Wilcox said.

Overall, economists say the U.S. economy is faring pretty well. U.S employers created 292,000 jobs in December and there are few signs of the economy sliding into recession.