In such a highly profitable market environment for oil producers, one would have expected a far greater surge of oil investments. Indeed, some producers have significantly ratcheted up their investment plans.
Notably, as subprime losses forced the credit rating agencies to downgrade what had been highly rated mortgage-backed securities, investors also came to doubt the reliability of ratings that had been awarded to other highly complex securities. As a result, investors became much more cautious and reversed their aggressive risk-taking of the credit boom period.