Drop in oil prices stings US’s Cowboy State

The weakened economic activity amid the ongoing coronavirus pandemic has naturally lowered the demand for oil, gas and other power sources, which has crippled the local economy of the American cowboy state Wyoming.

Marred by the economic uncertainty lead by the COVID-19 pandemic, the US state rich in oil, gas, and other natural resources has struggled to maintain its operations with limited production and exploration for new wells coming to a halt.

As per OilPrice.com, the rig count in Wyoming has dropped from 30 rigs in March to just two rigs in early June, with a drop of every rig meaning a loss of around 100 jobs in oil and gas industry.

And the problem despite a recent surge in oil prices doesn’t seem to wane off easily, with one of the state’s top oil producers Ultra Petroleum Corp declared bankruptcy last week, due to financial issues generated due to coronavirus pandemic.

“After several months of liability management efforts and careful consideration of how best to navigate a challenging low commodity price environment and our debt levels, Ultra’s Board of Directors determined that a voluntarily filing for Chapter 11 reorganization provides the best outcome for the entity,” said Brad Johnson, Ultra Petroleum’s CEO.

The departure of Ultra Petroleum Corp will not only lead to job losses but will also sting the state’s tax revenue collection, as well.