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Louisiana, Texas to see an increase in job opportunities in the oil and gas industry

January 5, 2023

Around 3,500 jobs are expected to be added in Louisiana by the second quarter of 2023. Texas is expected to gain about 12,200 upstream jobs. NOAA photo

That LSU Center for Energy Studies has published its 2023 edition of the Energy Outlook on the Gulf Coast (GCEO). As in previous years, this sixth edition of GCEO provides a comprehensive overview of the Gulf Coast region’s energy outlook for the year ahead. David E. Dismukes, Executive Director and Professor, and Greg Upton, Associate Professor, LSU Center for Energy Studies authored the report.

Last year’s GCEO looked at post-pandemic operational adjustments implemented by industry and the impact of the 2020 and 2021 hurricane seasons. GCEO 2023 looks at the impact of the Russo-Ukrainian war on global energy markets and energy security. The effects of the decarbonization policy and the anti-inflation law on corporate strategies are also considered.

The results include the following:

• By the second quarter of 2023, Louisiana is expected to create around 3,500 jobs. Texas is expected to add approximately 12,200 upstream jobs between August 2022 and Q2 2023; However, these model results do not assume that employment in either state will reach pre-Covid levels over the forecast period.

• Drilling activity will continue to increase but is unlikely to return to pre-pandemic levels. Oil production is expected to return to pre-pandemic levels over the forecast period, a sign of continued efficiency improvements.

• Both oil and natural gas prices are expected to fall in the coming year. While long-term oil prices are expected to return to pre-Russian-Ukrainian war levels, natural gas prices are likely to settle at higher average levels than over the past decade.

• Both oil and natural gas production in the region are expected to grow for a decade, although oil and natural gas prices are both declining (ie expected to fall over the forecast period).

• Significant investments in crude oil pipelines are unlikely to be required at this time given the investments in pipeline infrastructure over the past decade.

• Long-term growth in energy demand will lead to increased US energy exports; However, a global recession would reduce demand for energy products.

• An ongoing Russian-Ukrainian conflict will force adjustments to global energy supplies. Crude oil prices will gradually fall over the next few years, while Gulf Coast natural gas prices are likely to remain high (compared to historical trends after 2008) due to LNG export pressures.

• Supply chain constraints – caused by the economic recovery from Covid-19, sanctions following the war in Ukraine and the continued Trump-era trade policy with China – will continue into next year.

• Decarbonization policies will challenge existing Gulf Coast power generation, but also create opportunities for the region to take the lead in developing low- and net-zero emissions products. Over the forecast period, the GCEO sees decarbonization creating significant regional investment opportunities.

• Although solar capacity is likely to experience significant growth over the next five years, it is expected to account for only a small portion of all electricity generated for the foreseeable future.

• Up to US$175.4 billion in new energy generation investments through 2030, representing a US$15 billion or 7.9% reduction in total regional capital investment compared to last year’s GCEO over a comparable period.

• Production in the refining industry has recovered to pre-pandemic levels and is expected to continue going forward, although downward revisions may be needed if a severe global economic slowdown hits next year.