the oilfield boom going down?
my husband works in the oilfield for patterson uti he is a driller and i was wondering if the oilfield is really going down like some say or if its not as it sounds and if it dose go down how long did/dose it take to come back up i would like to know cause as it stands right now in utah there is not many jobs that he can go do to make that much money we have been so use to it for the last 6 years that we have to many bills for any other job to cover him and i both would have to work two jobs to make it barely so do i need to worrie and prepare myself for how ever long for it to pick back up or should i calm down and stop pulling out my hair please help!!! this is all started since we got the new president
- 1 decade agoFavorite Answer
The oil outlook is going good right now. You may need to relocate to a state that is rich in oil companies like texas or oklahoma I know my sisters husband works in the business and he is always getting calls from other companies in Oklahoma who want him to work for them.
- John WLv 71 decade ago
Most companies in the oil industry did their budget forecasts based on $50 to $60 a barrel oil back when it was $100 a barrel. Many are revising their forecasts for $30 a barrel oil which means they will be more conservative in the projects that they start. Overall, the danger is that a failing world economy will result in a lower demand for oil which would further depress the oil price. Houston has weathered the storm for now but will eventually feel some of the pain. Chances are current projects will continue but new projects will be postponed.
P.S. All of this has been in the works for years if not decades. The Credit Default Swaps were unregulated at the insistence of Greenspan from the Reagan administration. It was these default swaps that allowed banks to repackage sub prime mortgages as high interest quality derivatives by having companies like Lehman Brothers essentially underwrite them.
As it was unregulated, they overextended their liability and poof the Credit Default Swaps are worthless and all those triple A rated investments are now junk category investments. People talk about Fannie, Freddy and the Clintons encouraging people who didn't qualify for mortgages to file for subprime mortgages but the reality is that there was a mechanism for the banks to do a quick flip turning a bad investment into what looked like a good investment to sell so they were willing to take on more bad investments to keep on doing these flips. Now they realize that there is a downside and are holding onto their liquidity to cover their asses on the swaps they could not sell.
Note that Engineering Control Systems Theory which the US Army Corp of Engineers used to manage West Germany after WWII says that such a lack of regulation will lead to instability, exponential growth, and collapse as resources are not unlimited. Wish the bankers actually took some real math.
It's really not fair to blame the new presidency, at least not yet.