In North Dakota, oil is king.
So it seemed that way when production hit 1 million barrels a day last summer. But now, with oil prices in a slump and rig numbers down in North Dakota, is the state’s oil boom over? Maybe yes.
Just take a look at that word. “Boom.”
Merriam-Webster defines it as “a rapid expansion or increase” and “a rapid widespread expansion of economic activity.”
I’d say the past seven years of North Dakota’s oil industry can definitely be characterized as a boom. After all, quiet ranching communities like Williston and Watford City exploded in population in the years since the discovery of recoverable oil at the Parshall Field in 2006.
Williston went from 13,000 citizens to an estimated 30,000 living in the city and immediate area. That’s a boom for sure. Now? Not so much.
The oil industry’s taken a hit with prices around $40 a barrel for North Dakota sweet crude. With decreasing rig counts adding to this shrinking market price, it’s fair to say that the boom is indeed over.
No rapid expansion or increase is seen here.
But the oil industry is by no means over in North Dakota. It’ll go dry one day (mark my words, Lynn Helms), but oil’s period of prosperity, the “boom,” does appear to be over. For now.
That’s not to say it won’t return to soaring prices and economic expansion. And let’s look on the bright side, too. The oil in North Dakota is expected to last several more decades, so the industry is here to stay. There will always be wells; it’s just a matter of how many.
Meanwhile, this downtime may shake out the bad apples in western North Dakota. Dishonest, lazy-bones, unqualified workers may leave or get the boot in these days of oil gloom. Oil companies may keep the men they need most, and those who don’t want to work fewer hours for lower wages will leave.
That’s not to say that every worker who leaves is a loser, but it sorts out the ones here to stay and hopefully put down roots in a state that’s an agricultural and energy giant.
For now, the oil industry has taken a hit, and by definition, North Dakota’s boom appears to be over. Prices will recover (“to everything there is a season”), the rush will begin again and before you know it, the rapid widespread expansion of economic activity will be back.