The rapid descent of the price of oil in the global marketplace is being marked as a disaster for a host of producers, but is the slide really that difficult to comprehend? It’s not as if it was unexpected.
The trend of global oil production outstripping demand has been a fact-of-life for several months, so something had to give. A 250 per cent hike in price over eight years, followed by a 50 per cent drop, is part of the expectation.
While those embedded in the Alberta oilsands world of highly priced recoveries do have something to worry about on a grander scale, we can look beyond oilsands and see a Bakken play and traditional oil-gathering systems, still working effectively. Naturally there may not be the same profits that have been enjoyed for the past seven or eight years, but there is still a tidy sum to add to the positive side of the ledger with oil prices between $50 and $60.
Sticking with the positive theme, our oil patch friends may read recent developments as a prime opportunity to do a little consolidation in their back yards.
With lessened activity in the patch, the opportunity also arises for some sensibility to return to municipal housing markets on both the rental and purchase fronts. A little price competitiveness will hurt no one and benefit many, just as lower prices at the gas pumps will allow us to direct our earned dollars in a few other directions that were denied us before as we placed all our money and attention on housing, gas and food.
A little stability on the population front might benefit us after 10 years of scrambling to keep up with growth.
With a population of around 13,000 and 1,000 or more “shadow” residents within the Energy City, our inability to stay abreast of the growth has been well documented.
With the impending slow down in the patch, we may see a few hundred of those shadow citizens returning to the places they call home. These are the temporary employees who never intended to live here permanently anyway. They called somewhere else home and were only here for the big bucks. For the most part, they have been the ones who purchased housing, raised families, bought and licensed vehicles and paid taxes elsewhere. They’ll be leaving us now.
Alleviating a little pressure on local taxpayers, might be a good thing. Giving the working poor a bit of a chance to catch up, is a good thing. Levelling off some of the big wage jobs, could be a good thing too. With oil at $55, the era of the $150,000 rig hand may be over, at least for a year or two. Those with seniority, higher skill levels, better educations and no booze or drug records, will keep the jobs. Others will drift away, just as they drifted in.
The serious players, the real contenders, the true business enterprises and citizens, will stay the course, as they have in the past 80 years. The Energy City will continue to be the Energy City, except we will be allowed to grow a little more slowly and carefully and with more consideration for our fellow citizens who chose to make Estevan their true home.
A little slow down, is not a bad thing, it just has to be managed with skill. We’ve done it countless times before. It will be done again.
