Outlook for Oil Industry in Louisiana is Bleak
As oil prices continue to drop the outlook for Louisiana workers in the industry continues to look bleak. Oil is trading in the low twenties and President of the Louisiana Oil and Gas Association Gifford Briggs says the situation is dire. Two weeks ago when he surveyed members the predictions were extreme.
“They indicated that unless there was significate change in the positive direction, that they were expecting between 60 and 70 percent of their workforce to be laid off in the next 90 days,” says Briggs.
Briggs says local companies are taking a huge hit in profits not only from the virus but also from Saudi Arabia and Russia ramping up production. For example, Briggs says Louisiana Light Sweet Crude Oil has seen a 90 percent reduction in prices since January.
“I don’t know that there’s any industry that can suffer a 90 percent reduction of the sales price of their product in three months,” says Briggs.
Briggs says if prices do not recover by June first, storage facilities for oil will reach capacity and that’s when the industry will most definitely see a reduction in force.
“I mean it’s impossible to produce. And they will literally just have to shut down every well in more or less in the state, and it will extend to the Gulf of Mexico and everywhere else,” says Briggs.
(Story written by Matt Doyle/Louisiana Radio Network)