Oil Prices Are Down Again But Industry May Be Better Prepared

Rice University energy management professor Bill Arnold says oil companies have learned to be productive with lower oil prices.

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Just when it seemed things were looking up for the complete recovery of Houston’s oil economy, prices have dropped in recent months.

The year started with oil trading at around $60 a barrel. By early October, Brent Crude was above $80.

Prices have fallen sharply since, with West Texas Intermediate at just above $50 a barrel so far in December.

Even OPEC's decision last week to cut production, which usually sends prices upward, hasn't had much of an impact on that.

But at least on the surface, oil companies don't seem to be too affected.

That's because they have been cautious since the oil downturn, Bill Arnold, professor for oil management at Rice University and a former Shell executive, said.

"I think the good news is that because they didn't bloat staff again that the impact on employment here will probably be muted," he said, "and be a little more stable than has been in other cycles."

Arnold said that while 10 years ago $50 oil would have been a big problem, many oil companies are now able to do well with that price.

Click on the audio above to listen to the interview.