Falling Oil Price To Hit Texas Hard

Houston, TX (AHN) - While the rest of the U.S. is happy with dropping oil prices, the fall of crude oil price to below $50 a barrel spells an economic disaster for Texas, which is heavily dependent on its oil and gas industry.

Among the omens that an economic contraction will take place in Texas are a reduction in spending for drilling programs, axing of workers and a dip in tax collections.

The rise in oil prices in the international market spurred a second boom in Texas' oil industry the past few years as energy firms spent billions to fund explorations in areas deemed before too expensive to reach. With oil prices more than half of its former value in July, oil companies are now having second thoughts about their long-term plans.

Following the cutback, the U.S. rig count dipped last week by 51 to 1,941, according to the Nov. 14 report of Baker Hughes. Of the 51 shuttered rigs, 23 were in Texas.

Meanwhile, oilman billionaire T. Boone Pickens called on legislators on Thursday to be accountable to their promise to reduce U.S. dependence on foreign oil by passing a comprehensive energy plans. He pointed out politicians have been making that promise for decades now.

"Pickens told attendees to the Fort Worth Chamber of Commerce luncheon, "We're going to nail these elected officials this time... and we're going to see what they do on energy and if they don't have a plan, then they must be for foreign oil."