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Energy Index shows continued recovery

June 20, 2017
TOPICS: Energy Index
The state’s oil and natural gas industry continues its recovery from the oil price rout that started in 2014.

The Oklahoma Energy Index stood at 170.2 using data collected in April, a 0.6 percent decrease from the previous month’s reading. However, activity levels in the oil and natural gas industry are 13 percent higher than one year ago.

“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.”

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, said Dr. Russell Evans, executive director of the Steven C. Agee Economic Research and Policy Institute.

“Prices have recently given back some of these gains, but remain tentatively at levels that can support the developing recovery,” Evans said. “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 comprehensive measure of the state’s oil and natural gas production economy established to track industry growth rates and cycles in one of the country’s most active and vibrant energy-producing states. The OEI is a joint project of the Oklahoma Independent Petroleum Association (OIPA), Bank SNB and the Steven C. Agee Economic Research and Policy Institute.

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