Oil and gas job losses in Texas were even worse than reported

The oil and gas industry in Texas lost more jobs than reported after the federal government revised its employment estimates.

Nearly 60,000 oil drilling, production and services workers have lost their jobs between February and August, 20 percent higher than the 50,000 layoffs previously reported, according to a new report from the Texas Alliance of Energy Producers. The new job analysis from the statewide trade group comes after the Federal Reserve Bank of Dallas revised its employment data, which showed that more jobs were cut in the oil-field services sector than previously thought.

“The revised employment estimates clearly suggest that COVID-19 has cut into the upstream oil and gas sector to a deeper extent than previously thought – and those numbers were bad enough to begin with,” Karr Ingham, petroleum economist for the Texas Alliance of Energy Producers, said in a statement.

Texas’ oil and gas industry has lost nearly 30 percent of its jobs since the coronavirus pandemic plunged crude demand and prices, forcing energy companies to cut spending on oil and natural gas projects. There are an estimated 149,800 oil and gas employees in the Lone Star State as of October, The Texas Alliance of Energy Producers said.

Job losses appear to have hit bottom in August, and the industry added about 1,500 jobs between August and October. However, economists expect a slow recovery as coronavirus cases climb throughout the nation, depressing demand for gasoline and jet fuel.

Texas produced just under 4.6 million barrels of oil per day in October, down from the peak of 5.4 million barrels per day in March. The Texas Railroad Commission, which regulates the oil and gas industry in the state, issued 5,427 drilling permits between January and October, a decline of more than 45 percent compared to the same period in 2019, the Texas Alliance of Energy Producers said.

Texas saw an average of 122 rigs in operation during October, down 71 percent compared to the year-earlier average of 419 rigs. The rig count, tabulated by oil-field services firm Baker Hughes and energy research firm Enverus, is a leading indicator of future oil and gas production.

“It will be a long climb back, and indeed time will tell whether or not the industry will ever return to the pre-downturn levels reached in late 2018,” Ingham said.

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