A new report from the Oklahoma City Branch of the Kansas City Federal Reserve Bank indicated a fourth quarter energy survey revealed Tenth District energy activity dropped further and expectations for future activity continued to decline.

Chad Wilkerson, Vice President and Economist at the Oklahoma City Branch said firms reported that oil prices needed to be on average $65 per barrel of oil for substantial increases in drilling to occur.

“Tenth District energy activity dropped further in the fourth quarter of 2019, as indicated by firms contacted between December 16th and December 31st, 2019, stated the report.

“The drilling and business activity index fell from -23 to -48, indicating a continued, significant decrease in activity following a slight expansion earlier in 2019. “

But the survey also found the revenues index improved slightly and the wages and benefits index remained positive. But the employment index was flat. As a result, the supplier delivery time, profits, employee hours and access to credit indexes were also down.

When will things get better for the oil patch?

” Over 20 percent predicted an uptick in rig counts in Q2 2020 and 25 percent expected the U.S. rig count to increase in Q3 2020. However, over 33 percent reported they do not believe the rig count will increase in 2020 and listed timeframes extending into 2021 or later,” according to the survey.

Click here to read entire Federal Reserve bank report.