• 4 minutes Is The Three Gorges Dam on the Brink of Collapse?
  • 8 minutes The Coal Industry May Never Recover From The Pandemic
  • 11 minutes China Raids Bank and Investor Accounts
  • 1 hour In a Nutshell...
  • 8 hours Is OilPrice a cover for Green Propganda
  • 18 hours Putin Paid Militants to Kill US Troops
  • 11 hours Putin Forever: Russians Given Money As Vote That Could Extend Putin's Rule Draws To A Close
  • 7 hours During March, April, May the states with the highest infections/deaths were NY, NJ, Ma. . . . . Today (June) the three have the best numbers. How ? Herd immunity ?
  • 12 hours Victor Davis Hansen on Biden's mental acuity " . . unfit to serve". With 1 out of 5 Democrats admitting it. How many Dem's believe it but will not admit it?
  • 2 days Biden admits he has been tested for Cognitive Decline several times. Didn't show any proof of test results.
  • 11 hours Tesla Model 3 police cars pay for themselves faster than expected, says police chief
  • 2 days Apology Accepted!
  • 18 hours The Political Genius of Donald Trump
  • 2 days Why Oil could hit $100
  • 3 days U.S. natural gas at major disadvantage in Europe and China.
  • 2 days Per most popular Indian websites it was Indian troops not Chinese troops breach of LAC that caused the clashes. If you know any Indian media that claim to the contrary please provide the link
Oil Markets On Edge As Second Wave Hits

Oil Markets On Edge As Second Wave Hits

While hopes of a global…

Shale Giant Chesapeake Files For Bankruptcy

Shale Giant Chesapeake Files For Bankruptcy

Chesapeake Energy has filed for…

How To Take Advantage Of The Energy Stock Selloff

How To Take Advantage Of The Energy Stock Selloff

Anything related to oil and…

Zainab Calcuttawala

Zainab Calcuttawala

Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on…

More Info

Premium Content

Houston Oil and Gas: Cuts and Rehires Indefinitely Frozen

Despite indications that the Houston hemorrhage of oil and gas jobs has slowed down, the two-year old wave of advances in drilling and extraction technologies—pioneered by now-jobless engineers—will prevent rehiring from commencing any time soon.

Last week—and for the first time in over a year—oilfield services company Halliburton reported a quarterly profit. The profit was small in size, but refreshingly hopeful for Houston’s long-ailing oil and gas job market.

Months of job cuts and asset sales later, the company announced a slim $6 million profit and a stable global workforce at 50,000 employees.

A full ten percent of the 3,500 people Halliburton has fired over the past two years worked in Houston, making it the leading human-capital-bleeding energy company in the Texan city, according to August figures from the Houston Business Journal.

Industry patterns practically dictate that oilfield service companies are the first to feel the pain when a market downturn begins. When prices dropped from a high of over $115 in June 2014 to $79.44 in October of the same year, drillers immediately ditched the costs of renting equipment and additional services, true to form.

Offering deep discounts to otherwise pricey packages has become the norm for the services niche over the past two years as the oil supply glut looms large and proves unwieldy. The absence of a market correction has caused oilfield services giants, notably Halliburton and Schlumberger, to cut thousands of jobs.

Halliburton’s 2016 Q3 results, along with Baker Hughes and Schlumberger’s positive outlook on the status of the American drilling sector’s recovery send a clear signal: at even just a hair above $50, the oil price has risen high enough to end the oil and gas job cleanse in Houston.

This is good news only for those who have managed to keep their job after consecutive months of cuts in the metropolitan area, according to Jenny Philip, the senior manager of economic research for the Greater Houston Partnership. Related: Oil Jumps After EIA Reports Draw To U.S. Crude Stocks

“Houston is the energy capital of the world,” Philip said at an energy-related event during the WorkforceNEXT summit last week. “We love to boast about that in $100 oil, but we also have to own that in $26 oil or our current $52 oil.”

Philip’s analyst peers say $54 per barrel should trigger a round of new hiring as firms pursue new exploration projects, but she disagrees.

“We’re not going to see a huge hiring binge. As the industry recovers, significant hiring is still being held off,” the researcher said. “The concern with energy industry hiring is that a lot of the technological advances that were employed during the downturn actually cannibalized human capital. The projects that were hiring were the ones looking at technologies to take people out of the workforce.”

The drone company Cyberhawk leads one example of a major manpower-cutting initiative. It provides oil and gas companies such as Statoil, Shell and Total – all of which are active in Texas – with drones to conduct inspections that once took a 12-man team of engineers several weeks to complete.

With Cyberhawk’s equipment, the checks cost 90 percent less and take just two days.

So far, companies have been reluctant to reveal when, where, and how often they have used cost-reducing drones or similar services to try to stay afloat in a tight price environment.

If the job market has reduced as drastically due to technological innovation as Philip suggests, it is unlikely Houston’s oil and gas sector will ever need the human resources that it did at its peak in 2014.

By Zainab Calcuttawala for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News