Posted on 01/23/2016 12:59:38 PM PST by shepardspie33
OKLAHOMA CITY -- As oil prices continue to slide with no recovery in sight, the Oklahoma economy has begun to contract. Oil prices have fallen to 12 year lows, and the industry is undergoing its largest downturn since the 1990's. Meanwhile, investment bank forecasts continue to become more bearish.
According to the latest data released by the Bureau of Economic Analysis, gross domestic product in Oklahoma declined 2.4 percent in the second quarter, ranking last among U.S. states.
Prompted by depressed oil prices, these numbers were a stark reversal of the 6.5 percentage growth that occurred during the first quarter. In addition, gross receipts to the treasury were down 3 percent for fiscal year 2015, caused in large part by the significant decline in revenue collected from the oil and gas gross production tax. Collection of these taxes fell $409.56 million or 46.3 percent from the previous year.
Oil forecasts continue to decline, with investment banks slashing their previous prognostications.
The median price per barrel estimate is just over $50 for the fourth quarter of 2016. This spells disaster throughout Wall Street and poses a significant problem for the Oklahoma economy.
Even if prices rise to $50 a barrel, many shale producers are not able to break-even at such price points.
While to many, lower gas prices seem to be beneficial to the middle and lower classes, seemingly only negatively affecting the top brass of oil companies, the impact of low oil prices has a widespread effect on the Oklahoma economy that reaches across socioeconomic lines.
Declining oil prices harm more than just those employed directly in the oil sector. Oklahoma’s two largest cities, Oklahoma City and Tulsa, are both ranked in the top five nationwide in jobs tied to oil related industries...
(Excerpt) Read more at reddirtreport.com ...
I bet long haul truckers are happy.
At $1.29 per gallon, my only regret is that I can only drive one car at a time.
Just another Obama conspiracy to destroy the fossil fuel industries!
And everyone else driving on the road...
You know those “fuel surcharges” on everything you ship?
They’re still there...
One of life’s lesson is do not spend more than you make. Part of that is do not assume what you are making today will continue.
There are many stories of lottery winners that go crazy with all money they won. They do not think of the future. Governments are not immune to this.
When times are good, they spend like there is no tomorrow, but when tomorrow shows up with bad news, they are not prepared.
I hope Oklahoma can adjust to the “new reality”.
Then maybe they need to get into another line of work.
I think I will just leave my car running 24/7 just to do my part.
It is effecting PA, WV, OH, ND TX and any state that was doing well in oil, methane or wet gasses. The job loss starting to grow out of this is staggering.
It is a certainty that the price is going to reach record highs a year or two down the road, not because of any conspiracy or price-fixing, but because so many wells are going to be shut down because it is costing more to produce than they can sell it for.
I have ownership in 3 wells. Our break even is $ 43.00 a barrel.
Cheap oil is not killing me when I visit my kin in TN, NC, AZ, MI and CA.
In fact, I take more trips when the oil is cheap.
I feel sorry for those who are hurting, but we have been hurting for way too long.
If you truly believe that, I'd suggest putting every dollar you can into oil futures.
Dec 2019s are trading at 44 bucks / bbl.
You can be the next John Paulson.
Same old cycle. What comes down must go up, and vice-versa.
Heck it’s so cheap, I might just start drinking the stuff.
When you’re a billionaire, you can give me a high five on FR.
Good luck!
Whatever.
Was nice to fill up the 14 year old gas guzzling SUV for $22 today. Didn't think I'd EVER be able to fill up that low again.
Wife said that exact same thing the other day.
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