Despite sliding prices, oil activity in the Lone Star State shows no sign of slowing. The latest Texas Petro Index revealed record-setting figures for both well-permitting and employment during the month of October. The report surprised many industry analysts, who expected that inaction on the part of the Organization of Petroleum Exporting Countries (OPEC) would cause many producers to scale back their output.
According to the Petro Index, Texas crude oil production totaled 98.2 million barrels in October, about a 22.1 percent increase over October of last year. The Baker Hughes rig count found that 899 active drilling rigs contributed to this total.
In October, the Texas Workforce Commission estimates that the state's oil and gas industry boasted 312,200 employees, continuing record-high figures. However, crude oil prices during this month averaged $80.94 per barrel. More recently, the benchmark price for crude slipped below $60. This slide has led to economist Karr Ingham predicting a sea change in the marker.
"At this point a contraction is unavoidable," he was quoted in the report. "But other than the direct impact on the value of Texas crude oil production, lower wellhead prices in October did not appear to affect other upstream oil and gas indicators."
However, Ingham said the industry has yet to reach its peak. He expects that to happen in 2015, after which production while decline to reflect the falling prices.
Successfully navigating these significant market changes will be a challenge for oil drilling companies. Oil and gas strategy consulting can provide the necessary insight to make decisions that accurately reflect demand, helping to maintain the state's record-setting economy.