Economists expect that a plunge in oil prices
In San Antonio, economists expect that a plunge in oil prices from above $100 to below $50 per barrel means a slight negative impact, likely to be shrugged away by the strength of industries such as military, medical and tourism.
But drive an hour south to a region where drilling rigs punctuate the sky, and there’s an anticipated swing from boom to belt tightening.
“It’s a recipe for disaster for small businesses,” said Huy Doan, who in the past two years has opened two Donut Palace locations in Pearsall. “The reason I came here was for the oil field. I’m worried.”
It’s not yet obvious while trucks rumble through town and signs still shout “Now Hiring! Drivers Wanted!!” But a slowdown is creeping in.
Companies have started pulling back drilling plans. One of Doan’s regular customers said his oil field crew was trimmed from 100 to seven. Plenty of oil field workers and locals still swing by the the Donut Palace daily, but not as many as before.
“We’ll see some pretty big changes over the next few quarters,” said George Wommack of Petro Waste Environmental, which operates oil field disposal sites across the Eagle Ford region. Wommack grew up in Midland in an oil and gas family, and doesn’t think people have realized what low oil prices mean.