One of the most painful busts in the history of crude oil happened just six years ago when a sharp price drop cost 200,000 roughnecks, almost half the entire workforce, their jobs.
Texas Oilfield Caps
And now, the spread of the coronavirus coupled with an oil-price war between Russia and Saudi Arabia threatens to devastate the oil services industry and its workers once again.
Tens of thousands of Texans are being laid off across the state in places like the Permian Basin shale fields in west Texas as companies shut down their drilling rigs, according to Ryan Sitton, a state oil and gas regulator.
Announcements are starting to trickle in. Drilling service company Canary LLC cut 43 workers last week. Recoil Oilfield Services laid off 50 workers after the water-transfer company lost all of its work with shale giant EOG Resources Inc. But the biggest blow so far came from Halliburton Co., the world’s dominant fracking-services provider, which said this week it would furlough 3,500 workers at its Houston headquarters.
While workers in just about every industry are threatened by the economic slowdown, few are more at risk than those in the oilpatch. The Midland-Odessa region of West Texas, where Occidental Petroleum Corp. and Parsley Energy Inc. have dominated, could be decimated, according to a report from the Brookings Institutions. More than 40% of Midland’s workforce is in high-risk industries, mostly oil and gas, the highest of any region in the U.S., it said. Overall, the services workforce today stands at about 316,000, down about 30% from its peak in 2014.
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