August 21, 2015 – Houston Chronicle
Oil's latest milestone means another setback for Houston
By Robert Grattan and Rhiannon Meyers
U.S. oil fell below $40 per barrel for a time Friday, and U.S. stocks fell sharply for the second straight day as China's slowing economy reverberated across the globe.
The drop in oil prices continues to shake the Houston economy, portending more layoffs and budget cuts as analysts say there's no sign of a quick turnaround. Oil and gas companies hoped they had found price stability earlier this year when crude prices hovered around $60 per barrel for several weeks.
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An extended crude rout spells more trouble for Houston's oil and gas companies, which will need to make fresh cuts to their 2016 spending plans.
Exploration and production companies that had been hoping for a recovery may start issuing pink slips to workers they had furiously sought to hire during the boom years. Oil services contractors including Halliburton and Schlumberger that laid off thousands of workers earlier this year could cut even deeper.
"This was inevitable," said Rusty Braziel, president of Houston-based energy analyst group RBN Energy. "Better tighten your belts and be prepared for relatively low prices over the long haul."
