Waning commodity prices, which closed Nov. 17 down again at $40.67/bbl (WTI), continue to hit the coffers of oil and gas companies, pushing up the sector’s job losses higher.
Hundreds of thousands of positions have already been cut and unfortunately the reductions keep coming.
Last week, Noble Energy Inc. said it plans to cut about 7% of its workforce, about 180 people mostly located in the United States. The news came about six months after it reduced its staff by about 220.
The Houston-based E&P is among many companies that have let go of workers as the downturn lingers as oil supplies outpace demand. Others in recent months have included ConocoPhillips, Devon Energy, Husky Energy, Marathon Oil, Maersk Oil and Superior Energy Services to name a few, based on news reports. And just this week, Fuel Fix reported that three oilfield service companies—Cameron International, Trelleborg Offshore and National Oilwell Varco—will cut nearly 400 more jobs in Texas alone.
While it may be difficult to pinpoint exactly how many people have lost their jobs worldwide, the losses in Texas could be worse than previously estimated by the Texas Petro Index (TPI), which measures the health of the state’s oil and gas sector based on a set of upstream economic indicators such as production, rig activity and payroll data.
“We use two data sets from the [Texas Workforce Commission’s] Current Employment Statistics (CES) series in calculating the TPI, because it is monthly and timely and reflects the industry standard for reporting monthly employment data,” economist Karr Ingham said in a news release from the Texas Alliance of Energy Producers. “The CES, when a seasonal adjustment is applied, indicates the upstream oil and gas industry lost about 30,000 jobs through September since peaking in December 2014 at 305,000.
“That’s certainly significant enough, but it appears to be inaccurate when compared to the TWC’s Quarterly Census of Employment and Wages (QCEW), which measures jobs at the county level and sums up by industry,” he added.
If data from the quarterly report are accurate, the number of job losses in Texas would be greater than that previously indicated. Regardless, the number of job losses is astonishing.
While it seems highly unlikely that workers can collectively halt the trend, it’s important not to forget that sometimes when one door closes another one opens. And in some instances, that door may be at a nearby chemical or processing company searching for engineers and in the manufacturing sector.
Plus, it never hurts to network, whether it’s in person or via social media. In addition, picking up some new skills by taking a few continuing education or other college courses could better position laid off workers for more job opportunities in the future.
“When the upstream oil and gas economy in Texas entered into the current contraction, we estimated jobs lost over the length of the downturn could total 40,000-50,000 jobs,” Ingham said. “We now appear to be well beyond that estimate, and the end is not is sight.”
No one knows for certain when this downturn will end, but it’s best to be prepared for whenever it does.
Velda Addison can be reached at firstname.lastname@example.org.
Shell reached an agreement for the sale of its Permian Basin business to ConocoPhillips for $9.5 billion in cash, confirming rumors the supermajor was considering exiting the key shale asset.
The potential sale of Shell’s Permian holdings, located in Texas, would be a litmus test of whether rivals are willing to bet on shale’s profitability through the energy transition to reduce carbon emissions.
The share of drilling activity by Exxon Mobil and Chevron in the Permian Basin oil field in Texas and New Mexico dropped to less than 5% this month from 28% last spring, according to data.