Curious trends are happening in the Texas oil and gas industry, according to the Texas Alliance of Energy Producers March Texas Petro Index (TPI). Despite a decline in the March TPI to 212.4 and in the first quarter 2019, prices continue to improve and Texas crude oil production is still breaking records. A monthly measure of growth rates and cycles in the Texas upstream oil and gas economy, the TPI is based on indicators such as rig count, drilling permits, well completions, and employment, which all remained in decline in March.
“Typically, these E&P indicators decline during an observable, sustained contraction in oil and gas activity, but that doesn’t appear to be what we’re seeing now,” says Karr Ingham, Petroleum Economist for the Texas Alliance of Energy Producers and creator of the TPI. “I do think these decreases can partly—even largely—be attributed to the sharp and unexpected fourth quarter 2018 crude oil price declines, but clearly there are other forces at work. These have become increasingly evident over the course of the current recovery and expansion from the 2014 to 2016 industry downturn.”