Students preparing to take subsidized government loans will see their interest rates double to 6.

8% from current levels, starting Monday, July 1.

But hope isn't lost yet. Lawmakers are working hard behind the scenes trying to strike a deal to save the 7 million college students who are slated to take the subsidized federal Stafford loans this year. Senate Democratic leaders are throwing their weight behind a bill that would extend the 3.4% rates for another year, just as Congress did last year. House Republicans have said they'd prefer a longer term solution, like the one they passed back in April to keep rates low for now but rise along with market rates in the future. Students are being told to prepare for the worst and hope for the best. "We're advising our schools to tell students that their subsidized Stafford interest rates are going to be 6.8% on July 1," said Justin Draeger, president of the National Association of Student Financial Aid Administrators. Students with loans at stake have been watching the debate on Capitol Hill with worry and apprehension. Related: How I found a job after graduation "I find it really frustrating that nothing is even being brought up, since Congress is now in recess," said Rachel McGovern, who will be a senior at University of Florida this fall and will be taking out $5,500 in subsidized federal loans. "It feels like they're just ignoring student needs right now." The higher rates that go into effect on July 1 only apply to new loans, such as McGovern's. These loans are generally awarded to only about a third of undergraduate students in financial need. Only Congress can change the rates and any tweak to the law is expected to be retroactive July 1. But there was no clear message if any deal would be reached before the end of summer, when the number of students taking out loans will ramp up ahead of the school year. Generally, lawmakers in both parties in Congress and the White House agree that something should be done, but they don't agree on what. "Students across this country would rather have no deal than a bad deal," said Jack Reed, a Rhode Island Democrat, at a press conference last week on student loans. Related: I will graduate with $100,000 in student loans The Republican-controlled House passed a bill to stop rates from doubling now, but would allow them to rise later. Senate Democrats don't like it. President Obama vowed to veto it,

calling it the "wrong approach." However, Obama has a plan that's very similar to the House plan. Senate Democratic leaders want to extend the low rates for a year or two, and give Congress time to come up with a longer term solution as a part of the normal budget process. Meanwhile, a group of two Senate Democrats and two Republicans struck a deal that also resembles the House plan. Undergraduates, who take out unsubsidized student loans from the government, are already paying the higher 6.8% rate since 2007. Related: Class of 2013 grads average $35,200 in total debt Some Washington leaders want to revamp the student loan program and peg rates to economic conditions. The President and House Republicans, for instance, have proposed ways of tying student loan rates to 10-year Treasury notes. However, the two sides disagree on the details, such as how to cap rates in a way that will ensure students don't get hosed if interest rates skyrocket. They also disagree on ways to let students "lock in" their rates from year to year. Outsized student debt has become a pressing issue, with many young graduates deep in debt and without jobs. It is second only to mortgages as the largest debt that consumers carry. In 2011, students on average owed nearly $27,000 in loans.

Oil prices topped $100 a barrel Wednesday, as traders feared tensions in Egypt could spread to the broader Middle East.
U.S. oil prices rose as high as $102.18 early Wednesday, the highest they've been in over a year. While oil production from Egypt is negligible, the country controls the Suez Canal and pipeline, which move about 4 million barrels of oil per day. Plus, the country is one of the largest and most powerful in the Middle East and North Africa -- home to about a third of the world's oil production. "The fear of contagion in the Middle East to major oil producers is the ultimate concern," Matt Smith, a commodities analyst at Summit Energy in Louisville, Ky, wrote in a research note Tuesday. Protestors in Egypt have been demanding the country's democratically elected, Islamist president step down, saying he has not governed the country in an inclusive manor. The

protests are the largest the county has seen since the 2011 uprising that ousted longtime dictator Hosni Mubarak. Related: Eight states raise their gas tax Seven people have died in the protests, and the Egyptian military has given the president 48 hours to resolve the dispute. Some have hinted there may be a coup, though it's uncertain what actions the military will take. That deadline approaches Wednesday night. Oil prices have risen about 16% in the last two months. Traders cite an improving economy, rising demand for crude oil from refiners in the United States, and problems getting supplies of light, sweet crude to market as other reasons for the price run up.

Credit rating agency Standard & Poor's downgraded three European banks on Wednesday, citing worries over the size of their investment banking portfolios and the impact of new regulations.
The banks are Credit Suisse, Deutsche Bank and Barclays, all of which rely heavily on investment banking to drive revenue growth. All three firms had their ratings cut from A+ to A. "We base today's rating actions on our opinion of the increasing risks that Europe's large banking groups active in investment banking face as regulators and uncertain market conditions continue to make operating in the industry more difficult," the bank said in a statement. The outlook on all three banks is now stable, meaning further cuts to their credit ratings are unlikely in the near term. The downgrades come amid a shifting regulatory landscape for banks, changes that are forcing some of the largest firms to make significant changes to their operations. In addition, large banks are now working to raise funds required to meet new capital requirements, at a time when market volatility and a dour economic environment could impact earnings. "We consider that these banks' debtholders face heightened credit risk owing to the industry's tighter regulation, fragile global markets, stagnant European economies, and rising litigation risk stemming from the financial crisis," S&P said. Related story: The best-paid central banker The primary theme running through S&P's analysis was that each bank faces significant levels of uncertainty.

Investment banking makes up 40% of revenues at Barclays (BCS), S&P said, a business facing risks that "are unlikely to abate in the near-to-medium term." Credit Suisse (CS) sources up to 50% of its revenue from investment banking. Meanwhile, the rating agency said that Deutsche Bank's (DB) "ability to generate stable, predictable revenues" has decreased. "Barclays, Credit Suisse, Deutsche Bank and UBS are among the most exposed in Europe to a combination of regulatory initiatives being undertaken globally on capital market-related businesses," S&P said.