Oil & Gas Recovery Slows as Drilling Dips, Service Job Losses Rise

New drilling permits, oilfield service jobs hit ten-year lows, experts say

The sun is seen behind a crude oil pump jack in the Permian Basin in Loving County, Texas, on Nov. 22, 2019. Angus Mordant/Reuters

A report released Tuesday by Norwegian energy consultants Rystad Energy indicates that new horizontal drilling permits across the United States dipped to a 10-year low in July, with the sector unlikely to recover this year.

In addition, Rystad’s analysis of the top 50 oilfield service (OFS) firms shows staff levels in the sector also fell to their lowest level in 10 years as activities continue to decrease and companies strive to maintain their levels of revenue per employee. The CCP (Chinese Communist Party) virus has decimated demand for petrochemical products in 2020, hitting smaller fracking companies and oilfield service providers particularly hard.

Drilling Permits at New Lows

According to Rystad Energy, only 454 permits were awarded in July in the United States for horizontal drilling—the lowest level since September 2010. However, monthly numbers of permits in 2010 reflected an industry on the rise: Over 1,000 permits were issued every month from early 2017 through to the beginning of 2020.