The Texas oil and gas industry continues to shrink and since last June, drillers have laid off to 1 in 5 employees. But one analyst says that trend may be slowing.
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The job loss rate in the industry slowed in June, according to the index produced by petroleum economist Karr Ingham for the Texas Alliance of Energy Producers. He estimated about 900 jobs cut by oil and gas companies, compared to the thousands lost in January and February.
As second quarter earnings reports come in, we are hearing of massive losses for oil and gas operators across the country. For companies who haven’t resorted to bankruptcy, many must lay off workers to stay afloat. Schlumberger, Halliburton and Baker Hughes are the latest to report major layoffs saying they eliminated a combined 16,000 jobs in the three months between April and June.
Other producers who reported huge losses for the second quarter include ConocoPhillips ($1.1 billion), Baker Hughes ($900 million), Royal Dutch Shell, (2,200 jobs), BP, , Exxon Mobil, Chevron ($1.5 billion), National Oilwell ($217 million and PBF Energy.
Other highlights from the Texas Petro Index include:
- The statewide working rig count averaged 222, a 55.9 percent decrease when compared with the first six months of 2015 when an average of 504 rigs were drilling. In the first half of 2014, the number of rigs working in Texas averaged 869.
- The Texas Railroad Commission issued 3,539 drilling permits, 36.4 percent fewer than in 2015.
- Oil producers pumped about 603.9 million barrels of crude oil, a 5 percent, year-over-year decline compared with the 635.4 billion in the first half of 2015.
- About 213,050 Texans were employed in the oil patch in the first half of the year, a 22.6 percent drop from the same period last year. In the first half of 2014, the number of people employed in oil and gas production, drilling and service sectors was 291,365. At its peak in December 2014, the industry employed 306,000 in December 2014.
Crude oil prices dipped as low as the mid $20s in February and peaked at above $50 in early June. This week, they have settled in at around the $40 mark.