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Oil, gas industry expansion strengthens state

June 13, 2018
Continued expansion of the oil and natural gas industry is leading to a stronger state economy, the economist who compiles the Oklahoma Energy Index said this month.

Dr. Russell Evans, executive director of the Steven C. Agee Economic Research and Policy Institute, said every indicator in the most recent energy index trended higher, led by 5.6 percent and 4.1 percent gains in crude oil and natural gas spot prices, respectively. Price improvements prompted new rig activity with the average weekly rig count at 129, an increase of seven rigs over the previous month.

“Conditions are certainly favorable to carry the current expansion further, with the state enjoying the resulting spillover economic and fiscal benefits,” Evans said. “Should that expansion materialize, policymakers will need to apply lessons learned from our recent experience to better manage the next wave of economic fluctuations.”

The Index has grown by 12.2 percent from one year ago, reaching a level of growth last seen in March of 2011. The most recent monthly Energy Index grew by 1.9 percent and stands at 212.9 using data collected in April.

Evans said employment gains were modest in both the primary and energy support sectors and are consistent with expectations that the pace of hiring in the industry will slow in the second half of 2018.

The OEI 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 and the Steven C. Agee Economic Research and Policy Institute.
 
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