The economic repercussions in the oil industry from the Coronavirus (COVID-19), are expected to have some long lasting effects on the local economy.
"The oil capacity in West Texas if full and a price war between Saudi Arabia and Russia is leaving prices extremely low," said Jeremy Wynegar President of NeoChem Corporation in Houston. "Russia and Saudi Arabia are in a price war that is keeping prices low, and the clash is taking place during a major reduce in demand- with families staying home and airplanes not flying due to the COVID-19 pandemic. I believe our current situation in the oil industry will have long reaching effects and it could possibly destroy the smaller independent companies."
Texas Senator Ted Cruz met with the Trump Administration and CEO energy leaders in Washintion D.C. on Friday, April, 4. The meeting was to discuss the measures to help the oil industry from collapsing and contributing to an already obvious economic problem in mass unemployment and bankruptcies.
"The two main discussions during the two hour meeting included putting real pressure on Saudi Arabia to stop waging an economic warfare on the United States and to have capital for smaller oil businesses to access through loans during this time," said Senator Ted Cruz during an interview posted on his Facebook page.
The effects locally while navigating a public health pandemic and the city’s budget in relation to an already low sales tax revenue bottom-line; is what the City Manager of Alice, Micheal Esparza and his administration are currently working on.
"I have a conference call today with the city’s financial advisers to discuss options for funding and what other cities in Texas, with comparable sales tax revenue from the oil industry are doing in response," said Esparza. "The city is preparing for the loss in sales tax revenue in the coming months and currently responding by not hiring any non-essential positions, previous funded positions from the budget have been cut, and we are looking at some long-term capital expenditures that the city needs, but will be put on hold -to a later time."