Oil prices dropped after the bombshell announcement concerning Saudi Arabia and Russia.
The two countries could not come to any agreement on reducing production to shore up prices. And Saudi Arabia announced it would be ramping up production.
"Now it's back to every man for himself, in the world oil markets," said North Dakota Mineral Resources director Lynn Helms.
Helms said this means the potential for much larger – and much longer impacts on state oil tax revenue. He said the forecasted price for North Dakota crude was $48.50 per barrel – but the price is significantly below that.
"It takes three to six months to work itself into revised forecasting," Helms said. "That's also the time it typically takes to begin to impact oil and gas activity significantly."
Helms said it may take up to two years to recover to pre-virus oil prices, and that will likely have impacts on oil production in the Bakken.
"We had been predicting very slow growth in 2020, with improved growth in 2021," Helms said. "We had changed that to flat production in 2020. And this looks like it could extend that, to flat to slightly down this year, and pretty flat next year, until we see some price recovery."
North Dakota's record for production was 1.5 million barrels of oil a day. The last report -- which covered December -- was just under that mark.
