NEW YORK, Feb 4 (Reuters) - The U.S. energy
industry has cut almost 25,000 jobs since oil prices began to collapse
15 months ago, and thousands more will be lost unless prices recover
soon, according to a study released Thursday.
The study, conducted by the Independent Petroleum Association of America
(IPAA), comes after one of the worst years on record for the oil
industry, with prices dropping as much as 50 percent.
In 1998, the average price of crude oil at the wellhead was about $11.25
a barrel, the trade group said in its study, based on a survey of 720
oil and gas companies.
The Washington D.C. trade group warned that unless prices rise to an
average of $14 a barrel for the next six months, another 208,000 oil and
gas wells will be closed while 17,000 more U.S. jobs could be lost.
Such losses have shut down an estimated 136,000 oil and 58,000 natural
gas wells in the United States since November 1997, or about one-fifth
of the nation's total producing wells, the study found.
"These numbers are significant not only in terms of economic impact and
employment, but also because once these wells are abandoned, access to
the resource base tapped by these wells is gone forever," Gill Thurm,
president of the IPAA said in a statement.
The survey results indicate that 360,000 barrels per day, or about six
percent of nation's total crude oil production, has been lost because of
low prices, and that some two million bpd could be at risk.
Meanwhile, Thurm applauded a plan unveiled by the U.S. Interior
Department Thursday designed to aid low-volume oil producers with wells
located on federal lands.
The plan would allow companies operating "stripper" wells, those
producing less than 15 bpd, to suspend operation on federal lands for up
to two years without losing their leases.
But Thurm cautioned more still needs to be done.
"We are urging the Clinton administration and Congress to find a way to
save this industry, which is dying on the vine." |
