INDUSTRY
Energy Markets in Turmoil By: Karr Ingham
T
hings have gone from bad to worse. Following a year of lackluster oil pricing and a general decline in oil and gas E&P activity in Texas in 2019, oil markets are now reeling from the fallout of the coronavirus and its impact on energy demand growth in the U.S. and globally. What was poised to be another difficult year for the oil and gas industry in 2020 has now become something of a train wreck. The Texas Petro Index measures growth rates and business cycles in the Texas upstream (exploration and production) oil and gas economy in Texas. The TPI is based on 100.0 in Jan. 1995. The most recent cycle of industry expansion began after the index troughed in Nov. 2016 following two years of sharp and debilitating contraction. That cycle of growth essentially came to an end in the fourth quarter 2018 with a sharp drop in oil prices. The index began to decline in earnest in March 2019 and has declined for 11 consecutive months March 2019 - Jan. 2020 (inclusive). That trend was set to continue this year, and the downward pressure has gained considerable momentum in the first quarter of 2020 thanks to COVID-19, otherwise known as the coronavirus.
TAWEEW.ASURUT/STOCK.ADOBE.COM
The Texas Petro Index 1995-2020
Source: Texas Alliance of Energy Producers
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SHALE MAGAZINE ď “ MARCH/APRIL 2020
