The state’s oil and natural gas industry continues its recovery from the oil price rout that started in 2014, according to the Oklahoma Energy Index. With activity levels in the oil and gas industry rising 13 percent higher than a year ago, the index moved slightly lower for the month of April.
“Despite a slight pull-back in the Index for April, the overall Index is 13 percent higher year over year,” said Chris Mostek, senior vice president of energy lending for Bank SNB. “The metrics show the industry has strengthened over the past year, but will probably see continued price volatility as the market works to rebalance supply and demand.”
The Index stood at 170.2 using data collected in April, a 0.6 percent decrease from the previous month’s reading.
Drilling rig activity in the state averaged 125 active weekly rigs in April, more than double the 62 active rigs from a year ago. Rig activity is spurred by oil and natural gas prices that remain at levels supportive of production in Oklahoma fields.
“Prices have recently given back some of these gains, but remain tentatively at levels that can support the developing recovery,” said Dr. Russell Evans, executive director of the Agee Policy Institute. “More importantly, price expectations remain positive. It is still the case that an aggressive recovery in industry activity is not expected. Rather, industry activity will continue to trace out a slow but persistent recovery through 2017 and 2018.”
The Energy Index is a joint project of the Oklahoma Independent Petroleum Association, Bank SNB and the Steven C. Agee Economic Research and Policy Institute.