Oil Price Tremors Not Rattling Texas. Yet.
With crude oil prices nose diving in recent months, unsettling fears of idled rigs and plummeting profits have begun creeping through companies and countries whose livelihoods are tied to oil production.
But officials in some of Texas' booming towns aren't breaking a sweat just yet.
“The smart guys will figure that out," jokes Don Tymrak, city manager in Karnes City, from his office in the heart of South Texas’ booming Eagle Ford Shale. “There’s no alarm or red flag going up at the moment. We’re pretty much staying the course.”
In West Texas’ Permian Basin, Midland officials ...
Comments (8)
Susan Kocian via Texas Tribune on Facebook
Just like with any industry...there are slow months. People that own resorts have a booming business during the summer, holidays, other times it is slow. Don't worry the prices will go up again...it swings. Stock Market...
WUSRPH
What you did not mention was the impact of a lower price on the state budget. I have been told that a $1 drop in the price of oil cuts the state's revenues by about $40 million. This means $400 million for a $10 drop, etc. The estimates for oil tax revenues (some $3.2 billion) were developed when the price of oil was closer to $100. This suggests there should already have been a drop in revenues as well. The only thing keeping this from being a problem is that it has been offset by an increase in production but, assuming the price stays down or drops even lower, that is gong to fall off at some time and the impact will show up in state revenues and in the income of the Rainy Day Fund. At this point it looks like it is something that can handled but the longer the price stays down the more impact their will be.
Jack Daniels
The industry is not worried, because they know the price dip is temporary. The State budget will be hurt and it will make the upcoming Revenue Estimate very difficult to predict accurately.
Scott Creasy via Texas Tribune on Facebook
If they arent making billions, they walk away. Big business isnt honest business.
Adele Roberson via Texas Tribune on Facebook
http://www.motherjones.com/politics/2014/10/supreme-court-texas-voter-id-law-history
Gary T Harlow via Texas Tribune on Facebook
They may say that but they're taking pumping units off-line pretty rapidly in west Texas.
David Cargill via Texas Tribune on Facebook
If they have to spend their own money and not yours or mine. They throw in the towel! Weak sisters!
Paul Hughes via Texas Tribune on Facebook
I will worry after prices drop below Bush-era prices ($1.89 per gallon in 2008) and we no longer import foreign oil.