WASHINGTON, D.C. (Nexstar) — The oil industry is worried that the coronavirus could cost more than half a million oil and gas industry jobs.
Oil prices have hit an 18-year low: there’s too much supply and freefalling demand.
Industry leaders are now turning to the federal government for help.
When the New York Stock Exchange bell rang on Monday, Dan Eberhart, CEO of Canary Oil, says alarm bells went off in the oil industry.
“I’ve been doing this 20 years, and I have never seen oil go below 33, 31, somewhere in that range. Today it’s just about 20,” says Eberhart.
That’s the lowest crude oil price in almost two decades.
Eberhart says there’s no shortage of supply, but with Americans staying home to slow the spread of the virus — and not driving or flying like normal — demand is drying up.
“There is virtually no jet fuel needed,” says Eberhart. “Which is about 30% of oil demand typically.”
On top of that, there’s the ongoing price war between Russia and Saudi Arabia.
Russia has refused to reduce oil production to prop up prices and the Saudis retaliated by flooding the market.
Texas Republican Senator John Cornyn is working to smooth things over with Saudi Arabia.
He says if oil prices don’t start climbing, more than half a million jobs in oil-rich states like Texas, Oklahoma and Louisiana are at risk.