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How dropping oil prices could affect the Bakken

(KFYR)
Published: Mar. 9, 2020 at 7:48 PM CDT
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Job security and local government budgets in the Bakken could be affected negatively due to a steep drop in the price of oil Monday.

Williams and McKenzie County are the state’s largest oil producers, and Aleisa Tanner tells us what an unstable flow of income could mean for the area.

If the dramatic drop in the price of oil lasts long enough, it could affect people’s livelihoods in North Dakota's energy industry. Companies might be apprehensive about hiring more workers and keeping the ones they have.

“Will that mean layoffs? Perhaps. We really don’t know until companies sit around their tables making their decisions. Things get decided differently if you’re a global corporation versus a local mom-and-pop,” said Paula Hickel Williston Job Service ND workforce center manager.

Hickel says the good thing is that there are an abundance of available jobs in the Bakken. But, when companies aren’t making as much per barrel, they aren’t the only ones affected.

Gene Veeder, McKenzie County commissioner, stated: “The budget that McKenzie County operates out of largely consists of taxes that are generated by the energy-industry. We hope that it’s not a long-term thing, and that it’s just one of the cycles that the industry goes through.”

Veeder added that depending on how long oil prices stay low, companies could also be more apprehensive about drilling new wells.

There are currently 56 active rigs in the state. The price of oil as of Monday night is $32.50 per barrel. That’s a drop of $20 in the last month.