By Alicia Neaves
PERMIAN BASIN - As big name oil and gas companies prepare for a downturn, thousands of layoffs are on the horizon. Baker Hughes is the latest to announce cutbacks.
"This is a worldwide recession right now," Oil Expert, Morris Burns, said.
It's a sight that makes your stomach drop if you're in the oil industry. Rigs are stacked up for all drivers to see down Highway 80 near the Ector County line. Experts say most rigs coming back into the yards are vertical rigs, not horizontal.
"We're consuming and producing about 93 million barrels a day. Right now, there's about two million barrels in excess capacity, so this is pushing the price down," Burns said.
On Tuesday morning, oil barrel prices fluctuated in the high 40's. The price of a barrel of crude has dropped more than 50% since last year.
Storms in the North Sea or oil worker strikes abroad are just a couple of examples of what could drive the price back up.
In a statement, Apache Corporation says, "The decision to part with employees is always a very difficult one and it's a step we took this week after pursuing other measures including a slowdown in activity and reduction in budgets given the current price environment. The staff reduction constitutes less than 5% of our global workforce (or less than 250). We did not provide a breakdown by area but it was a decision that affected the company globally."
Halliburton says they have, "...not had workforce reductions in our Permian Basin operations. However, we will continue to monitor the business environment closely and will make adjustments to the cost structure of our business as needed."
Baker Hughes, who was bought out by Halliburton, announced it will lay off 7,000 workers - roughly 11% of employees worldwide - as it prepares for a downturn.
Schlumberger said last week it would reduce its workforce by 9,000 employees.
Experts say many who will keep their jobs might see a cut in overtime.