Page 7 - Aruba Today

U.S. NEWS A7
Tuesday 29 December 2015

US Financial Front:

Oil slump weighing on housing markets in Texas, North Dakota

In this May, 2015 photo, more than 30 oil drilling rigs are idle in a ing bubble bust. jobs this year, according to ergy sector.”
Helmerich & Payne, Inc. yard along Groening Street in Odessa, Workers stuffed hotels, Labor Department data. Still, the two cities contin-
Texas, as rig counts drop in the Permian Basin. sending room rates soar- In Texas, no stranger to oil- ue to have a seller-friend-
ing, as they looked for related housing booms and ly four-month supply of
(Courtney Sacco/Odessa American/AP) housing. Others piled into busts, the impact so far has homes for sale. That’s more
sprawling, hastily-erected been most pronounced in than the two months they
ALEX VEIGA cal market is going to feel housing complexes called Odessa and Midland, cit- had before the oil slump,
AP Business Writer it,” said Jim Gaines, chief mancamps. “It was not un- ies at the doorstep of the but still representative of a
There’s a dark side to those economist at the Real Es- usual to have a house on Permian, a key shale oil tight market for homes. A
delightfully low gas prices: tate Center at Texas A&M the market and, in less than region that extends from six-month supply of homes
Housing markets are slump- University. a week, have multiple of- West Texas into New Mex- is what economists consid-
ing in communities that Despite the softer sales, fers. It was a crazy market,” ico.Home sales in Odessa er a balanced market.
were recently flush from home prices have mostly said Scott Kesner, chair- fell 10.6 percent through In El Paso home sales have
the U.S. shale oil fracking held up in oil-reliant mar- man of the Texas Associa- October this year from a also declined. They’re
boom. kets, at least so far. tion of Realtors.That frenzy year earlier, according to down 8.8 percent in the
Home sales are down Still, housing is expected to began to dissipate early in the most recent informa- January-September period
sharply this year in North slow further in Texas and 2015 as the slump in crude tion from housing data firm from a year earlier.
Dakota and the West Tex- North Dakota next year dragged on, and it has RealtyTrac. Sales declined In Houston, sales began to
as cities of Midland and unless the price of oil re- since deepened. Crude is 8 percent over the same decline in October, and
Odessa. Home sales have bounds strongly, something trading near $38 a barrel, period in nearby Midland. the median home price
also slowed in El Paso, and, oil companies, govern- a level not seen since the “They are going to bear has fallen for two months
more recently, in Houston. ment energy analysts and depths of the recession in the brunt,” said Gaines. in a row following 41 con-
The drilling boom, driven Wall Street traders do not 2009. The energy and min- “They’re right there at the secutive months of price
by high oil prices and new expect to happen soon. ing sector has shed 122,300 point of the spear in the en- increases.q
discoveries, brought tens The U.S. oil boom kicked off
of thousands of workers to toward the end of the last
oil fields in several states to decade as drillers learned
run drilling rigs and supply to improve the extraction
the equipment and ser- process known as fracking
vices needed to produce to unlock oil trapped in un-
crude. Then the price of derground shale rock for-
oil tanked, plummeting by mations.
half in late 2014 and reach- The Permian basin in West
ing levels this year not seen Texas and the Bakken For-
since the financial crisis. Oil mation in western North
companies abandoned Dakota quickly became
drilling projects and began magnets for workers, in-
laying off workers. cluding many laborers who
“When your economic had been struggling to find
base is undergoing that work in the home construc-
kind of pressure, your lo- tion industry after the hous-