Falling oil prices by more than 50% since June has deflated the gleeful mood of recent years as the shale oil drilling comes to a rude halt. Each passing day oil companies are decommissioning rigs and announcing layoffs. Other associated business like restaurants and clubs are already feeling the pinch.
It was grim irony when a Mercedes dealer is focusing on repairs and sales of used cars anticipating reduced demands. People are also cutting back at home, cancelling vacation plans.
The early 80’s was boom times with people drinking Dom Pérignon out of their cowboy boots. Rolls-Royce opened a dealership and the small local airport had a harrowing time trying to fit in all the private jets. However today it is fraction of its former glory. The Rolls Royce dealer has wound up and there is a tortilla factory in its place.
Shale production unlike oil rigs can be turned off and on quite easily without much effort.
According to recent estimates by the Dallas Federal Reserve, falling oil prices will reduce the job growth from 3.6% last year to 2 percent this year which translates into a loss of 149,000 in jobs