With the overall oil market news of oversupply and lessening demand remaining consistent over the past few months various U.S. state economies and international economies have suffered in different ways.
- Kern County in California has seen $8 billion disappear from its property-tax base causing cuts in all county departments with further cuts anticipated.
- In Alaska, Louisiana and Oklahoma the market drop which has led to less tax revenue is causing investors to want higher yields on their investments.
- In the largest oil producing state of Texas the energy slowdown has led to a 3% decrease in sales tax revenue for November 2015 vs. November 2014.
- Colorado is estimating a 2015 budget shortfall of $208 million.
- North Dakota tax collections are behind 9% for the state 2015-2017 budget.
As one analyst commented “the longer it goes the more significant it gets.”
- Saudi Arabia has reduced energy subsidies with defense and security now budgeted to be the biggest item of their government spending.
- The Saudi Arabian government will increase the prices of fuel, electricity and water as they plan to restructure subsidies within five years.
- Revenue in Saudi Arabia is forecast to drop approximately 17% in 2016.
A London based analyst stated “Saudi society will have to get used to a new way of working with the government. This is a wake-up call for both Saudi society and the government that things are changing.”
As of mid-day today Heating Oil and RBOB are both up .03 - .04 cents while crude is up .01.