May 11, 2018
Job growth in Texas’ oil industry accelerated in March 2018, with mining support activities growing at an annual pace of 27.3% and adding 8,800 jobs from December 2017-March 2018. The less-cyclical extraction sector grew at an annual rate of 11.4%, adding 2,070 jobs during the same period, according to the Federal Reserve Bank of Dallas. Meanwhile, the average number of active drilling rigs in Texas increased by 13 from March-April 2018, with most gains in the Permian Basin.
That’s the good news. The not-so-good news is that Permian oil production growth is putting a strain on existing pipeline capacity. Data suggest that Permian production could exceed transport capacity between mid-2018 and mid-2019 if new pipelines are not brought online. Information from the Energy Information Administration, company reports, the Dallas Fed Beige Book and the Dallas Fed Energy Survey suggest pipeline congestion could become a significant challenge to production in early 2019.
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