Midland_Oil and gas companies in Texas are cutting back on drilling as crude prices drop below $40 per barrel. The Associated Press reports the layoffs are beginning and the boom of the past few years appears to be drawing to a close.
Midland City Manager Courtney Sharp expects a drop in tax revenue next month because of slumping sales. Kevon Horst landed his first job in the booming West Texas oilfields when crude was selling for about $140 a barrel last summer. Horst and about 20 others working a rig near Canadian, about 40 miles from the Oklahoma line, were laid off recently.
He and his girlfriend moved in with her mother. He's struggling to keep up with the $500-a-month payments on his new truck. Overall unemployment is still low in Texas oil towns - 3.1% in Midland and 3.7% in Odessa, or about half the national average.
Ben Shepperd with the Permian Basin Petroleum Association says everybody is feeling anxious about the future. Industry experts said that until prices climb back to $70 per barrel or so, drillers may be unable to persuade lenders to give them the financing they need.