LONGVIEW, TX (KLTV) - A welcome announcement by oil-producing nations is giving East Texas oilfield workers and support businesses new hope that the market is turning
The price of oil is up to $50 a barrel after news of a preliminary agreement among OPEC nations to cut production in an effort to raise the price of crude. It was the news many oilfield businesses were waiting for; a sign for an oilfield comeback.
"They've taken at least the first step as far as agreeing in principle to reduce production. They want high prices; on the other hand, they want market
share and high production. They've been primarily concerned about market share, and now they're concerned about the price," says LeTourneau university professor and economist Dr. John Barrett.
And increasing their price is good for East Texas.
"If we saw an increase in the price of oil, that would certainly be a boost to the local economy. You could see prices go up which will help people that are already in the game, and give a little more incentive to those that want to get into the game," Barrett says.
OPEC cutting oil production is good news for Texas. It means more domestic production, and more people going back to work.>
"Yeah, it's always good news when it goes up. It helps businesses around here to succeed, every little bit helps," says Kerry Whorton who is a hydro
and coating supervisor at Energy Weldfab.
For those whose volume of work is dependent on oil prices, the news means more work on the way.
"Yeah a little bit more business a little bit more inquiries, it helps everybody out," Whorton says.
But the professor says OPEC could change the market again.
"What this means is they have made a tentative agreement in principle to cut back on production. Well is everyone going to abide by the agreement.
We've been preparing for it to kick back up, so we're ready," says Barrett.
Barrett says the wild-card in this scenario is whether non-OPEC countries will increase their production, which could affect the price of oil by
Copyright 2016 KLTV. All rights reserved.