By Jennifer Loren, The News On 6
TULSA, OK -- The price of crude dropped more than 10% on Monday, closing at $40.15 a barrel. Those plunging oil prices could be threatening Tulsa's economy.
In a state where many people depend on oil for their paychecks, they say this is just another sign that fear has a stronghold on the market and their industry.
"This is a world slump. This is not a United States slump," said Larry Nation with the American Association of Petroleum Geologists.
Larry Nation is part of the American Association of Petroleum Geologists on the exploratory side of the oil business. He says his sector of the industry has been hit hardest by the economic slump because people have stopped looking for new wells.
"Right now there are a lot of companies, very good companies that are very active, that haven't drilled a well since September," said Larry Nation with the American Association of Petroleum Geologists.
He says much of the problem is fear. People are scared to invest in oil.
And, with the deteriorating global economy it doesn't look like things will get better anytime soon. Every time the government steps in to bail out another major U.S. corporation, like AIG, pessimism in the energy markets grows stronger.
"Right now we have a artificially depressed price because of the attitudes that people have and the fear that's in the marketplace," said Larry Nation with the American Association of Petroleum Geologists.
That is bad news for Oklahoma where much of the economy is built on oil projects is a slow down like this means less payroll for Oklahomans and less tax revenue for the state.
But, Nation says, it could always be worse.
"Luckily they haven't started cutting back on personnel. If we continue on our downturn those kind of cuts are going to have to be considered," said Larry Nation with the American Association of Petroleum Geologists.
Many people believe oil could drop to $25 a barrel within a few months.