HOUSTON — Halliburton is implanting a mandatory furlough for 3,500 Houston employees at its North Belt campus due to the current market conditions for the oil and gas industry.
The furlough, which will begin March 23, will last up to 60 days, according to Senior Director Emily Mir.
Employees will work every other week and will not be paid or allowed to perform any work on behalf of the company on their week off.
“We believe moving to this schedule will allow us to best manage costs and provide full benefits for our employees during this difficult market,” said Mirr.
Employees’ benefits, including health insurance, will remain in place during the furlough period.
Halliburton is one of the world's largest oil field service companies.
With the viral coronavirus outbreak spreading to more countries, the price of oil has dropped precipitously as global demand weakens even further.
In early March, oil prices plummeted to their lowest point in decades as Saudi Arabia declared a price war on Russia, adding another stressor to financial markets already reeling amid concerns over the rapid spread of coronavirus.
While Texas’ economy and budget are highly sensitive to oil prices as the nation’s top oil-producing state, economic and energy experts and state officials said that it’s too soon to say how big of an economic hit the state will take. That will depend on how long both the Saudi-Russia deadlock and the COVID-19 outbreak persist.
If either one becomes a prolonged crisis, energy experts say, the impact could be devastating.
“The consequences for Texas of the drop in prices over the weekend will depend on two questions: 1) how low, and 2) how long,” Dale Craymer, president of the Texas Taxpayers and Research Association, wrote in an email. “Of course, we can’t look at the impact of a drop in oil prices on Texas in a vacuum. Behind all this is the economic impact of the coronavirus, which is still uncertain.”
When oil production slows in Texas, employment and tax revenues decline, and budget cuts at the state and local levels often follow.
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