Dallas Fed: Biz Activity Index Up, Firms Weigh in on Harvey

The business activity index among oil and gas executives increased in the 3Q, according to the quarterly energy survey from the Dallas Fed, which was released Sept. 27.

The business activity index, which measured the conditions facing 143 energy firms – both E&P and oilfield services – in the Eleventh District (Texas, northern Louisiana and southern New Mexico), fell slightly from 2Q, but remained positive for the sixth consecutive quarter.

Production increases, oilfield services equipment utilization increases and rising employment and employee hours contributed to the positive index score.

This quarter’s survey asked specific questions about how Hurricane Harvey affected business operations. Seventy-two percent of firms said Hurricane Harvey negatively affected their business; however, 62 percent don’t expect their business to be negatively affected by Hurricane Harvey six months from now. Still, 82 percent of respondents expect Hurricane Harvey to negatively affect the broader energy sector (including midstream and downstream) in the next six months.

Also included in the survey are respondents guesstimates as to where oil prices will go. On average, respondents believe WTI crude oil prices will be $50 by year end.