USA - Oil and Gas Extraction - Estimated Impact by Low Prices on Economic Aggregates

by Eduardo Petazze
10/05/15
The fall in international crude oil prices have had a significant and negative impact on the financial results of the
exploration and production of oil and gas in the US
However, the continuous improvement of these results are expected from the 2nd quarter of 2015
This document is intended to estimate the impact that lower crude oil prices will have on US macroeconomic
aggregates for the sector of oil and gas extraction.
Between 1998 and 2013 (latest official GDP data), at current prices, the Gross Output by O&G Extraction has
increased from 0.446% of the Gross Output by All Industries up to 1.343%. During this period, the Gross Value
Added has increased from 0.427% to 1.741%, in relation to gross value added by all industries.
For the first quarter of 2015 it is estimated that in the oil and gas extraction, the Operating Surplus has been reduced
by 77.7% over the previous quarter, but still maintains a positive sign. By 2015 it is estimated that the Operating
Surplus of the sector will be reduced by 59.4% over 2014.
If the analysis is performed with S&P 500, Energy Sector, the operating margin in 1Q2015 was located in negative
territory (0.56% of sales) from a positive margin of 5.72% in 4Q2014. By 2015 it is estimated that the operating
margin will be around to 3.37% from 7.95% in 2014. By 2016 it is estimated that the operating margin will be located
at 5.91% of sales.
The following table shows the annual, and an estimate of the quarterly, evolution of the main components of Gross
Output by O&G Extraction industry.

Gross
Output
72.1
85.1
144.9
142.7
116.9
166.2
198.9
260.6
271.0
293.6
395.4
223.6
289.7
343.7
348.4
399.2
425.1
264.4
311.9

YoY

Mining: O&G Sector Billions of Dollars

Intermediate Value
Employees
Net Operating
YoY
Consumption Added
Compensation taxes Surplus
33.3 38.8 -29.71%
12.3
8.1
18.4
41.2 43.9 13.14%
12.3
7.9
23.7
76.7 68.2 55.35%
13.4
10.1
44.8
65.5 77.2 13.20%
14.1
11.6
51.5
46.4 70.5
-8.68%
13.2
11.3
46.0
72.6 93.6 32.77%
13.6
13.2
66.7
85.5 113.4 21.15%
15.6
15.3
82.5
104.4 156.2 37.74%
17.2
20.1
118.9
92.8 178.2 14.08%
20.9
23.3
134.0
88.4 205.3 15.21%
22.6
27.0
155.7
114.8 280.5 36.63%
27.3
36.4
216.8
39.0 184.6 -34.19%
25.9
24.0
134.8
80.3 209.3 13.38%
27.6
27.0
154.7
91.2 252.5 20.64%
30.6
32.0
189.9
88.0 260.4
3.13%
34.7
32.5
193.2
107.3 291.9 12.10%
36.0
33.0
223.0
121.9 303.2
3.86%
36.9
35.0
231.3
109.2 155.2 -48.82%
36.6
24.7
93.9
117.1 194.8 25.57%
35.4
27.2
132.3

YoY

1998
-26.28%
-45.88%
1999
18.03%
28.80%
2000
70.27%
89.03%
2001
-1.52%
14.96%
2002
-18.08%
-10.68%
2003
42.17%
45.00%
2004
19.68%
23.69%
2005
31.02%
44.12%
2006
3.99%
12.70%
2007
8.34%
16.19%
2008
34.67%
39.24%
2009
-43.45%
-37.82%
2010
29.56%
14.76%
2011
18.64%
22.75%
2012
1.37%
1.74%
2013
14.58%
15.42%
2014
6.49%
3.72%
2015
-37.81%
-59.41%
2016
17.98%
40.88%
Latest data
Provisional data based on official data for the entire mining industry
Own estimation, alternative optimistic version
Mining: O&G Sector, Billions of Dollars, at annual rate
Gross
Intermediate Value
Employees
Net Operating
QoQ
QoQ
QoQ
Output
Consumption Added
Compensation taxes Surplus
2006Q1
277.6
-6.64%
99.8 177.8
-1.06%
20.2
22.4
135.2
-4.52%
2006Q2
272.6
-1.80%
94.0 178.5
0.39%
20.7
22.9
134.9
-0.22%
2006Q3
272.0
-0.22%
92.8 179.2
0.39%
21.1
23.7
134.4
-0.37%
2006Q4
261.9
-3.70%
84.5 177.4
-1.00%
21.5
24.0
131.9
-1.86%
2007Q1
265.9
1.53%
85.0 181.0
2.03%
21.9
26.6
132.5
0.45%
2007Q2
291.4
9.59%
89.1 202.3 11.77%
22.3
26.9
153.1 15.55%
2007Q3
297.1
1.96%
87.7 209.5
3.56%
22.7
27.3
159.5
4.18%
2007Q4
320.0
7.71%
91.9 228.2
8.93%
23.4
27.3
177.5 11.29%
2008Q1
376.2 17.56%
123.5 252.6 10.69%
26.4
35.5
190.7
7.44%
2008Q2
461.5 22.67%
152.2 309.2 22.41%
26.8
35.5
246.9 29.47%
2008Q3
437.7
-5.16%
125.3 312.3
1.00%
27.8
36.7
247.8
0.36%
2008Q4
306.2 -30.04%
58.3 247.9 -20.62%
28.2
37.9
181.8 -26.63%
2009Q1
234.4 -23.45%
37.6 196.8 -20.61%
26.6
23.6
146.6 -19.36%
2009Q2
210.8 -10.07%
34.4 176.4 -10.37%
26.0
24.3
126.1 -13.98%
2009Q3
212.6
0.85%
37.5 175.1
-0.74%
25.7
24.4
125.0
-0.87%
2009Q4
236.6 11.29%
46.5 190.1
8.57%
25.4
23.7
141.0 12.80%
2010Q1
280.1 18.36%
71.1 208.9
9.89%
27.2
28.0
153.7
9.01%
2010Q2
280.2
0.05%
78.5 201.7
-3.45%
27.5
27.2
147.0
-4.36%
2010Q3
293.6
4.78%
88.1 205.5
1.88%
27.7
26.4
151.4
2.99%
2010Q4
304.8
3.80%
83.5 221.2
7.64%
28.0
26.4
166.8 10.17%
2011Q1
319.6
4.87%
87.1 232.5
5.11%
29.3
32.0
171.2
2.64%
2011Q2
351.1
9.84%
96.7 254.3
9.38%
30.3
32.0
192.0 12.15%
2011Q3
346.7
-1.25%
91.3 255.3
0.39%
31.0
32.0
192.3
0.16%
2011Q4
357.5
3.12%
89.6 267.8
4.90%
31.9
32.0
203.9
6.03%
2012Q1
357.7
0.07%
94.1 263.6
-1.57%
33.9
33.0
196.7
-3.53%
2012Q2
336.9
-5.81%
84.4 252.5
-4.21%
34.5
33.0
185.0
-5.95%
2012Q3
342.2
1.56%
84.3 257.9
2.14%
35.0
32.3
190.6
3.03%
2012Q4
356.9
4.30%
89.3 267.6
3.76%
35.3
31.5
200.8
5.35%
2013Q1
368.4
3.22%
97.0 271.3
1.38%
36.1
34.7
200.5
-0.15%
2013Q2
390.3
5.96%
104.4 285.9
5.38%
35.9
33.8
216.2
7.83%
2013Q3
426.6
9.29%
118.2 308.3
7.83%
36.0
32.2
240.1 11.05%
2013Q4
411.6
-3.50%
109.5 302.1
-2.01%
36.0
31.3
234.8
-2.21%
2014Q1
416.8
1.26%
120.7 296.1
-1.99%
36.3
35.8
224.0
-4.60%
2014Q2
452.2
8.49%
132.9 319.3
7.84%
36.6
37.5
245.2
9.46%
2014Q3
435.5
-3.69%
125.3 310.2
-2.85%
37.1
35.0
238.1
-2.90%
2014Q4
395.9
-9.09%
108.8 287.1
-7.45%
37.6
31.6
217.9
-8.48%
2015Q1
216.8 -45.24%
106.8 110.0 -61.69%
36.8
24.6
48.6 -77.70%
2015Q2
266.1 22.74%
110.1 156.0 41.82%
36.4
24.0
95.6 96.71%
2015Q3
286.7
7.74%
113.5 173.2 11.03%
36.6
24.8
111.8 16.95%
2015Q4
287.9
0.42%
106.5 181.4
4.73%
36.6
25.3
119.5
6.89%
2016Q1
299.5
4.03%
110.4 189.1
4.24%
35.7
26.1
127.3
6.53%
2016Q2
308.7
3.07%
120.4 188.3
-0.42%
35.2
26.9
126.2
-0.86%
2016Q3
317.7
2.92%
123.0 194.7
3.40%
35.4
27.6
131.7
4.36%
2016Q4
321.7
1.26%
114.5 207.2
6.42%
35.3
28.1
143.8
9.19%
Latest official annual figure, restated for quarter
Provisional data based on official data for the entire mining industry
Provisional own estimate (optimistic version)
Own estimation, alternative optimistic version - It has not been taken into account possible effects on the variable
compensation of employees
Note: Estimates and provisional data are based on the third quintile of a projection model (optimistic version)
PS: S&P500-Energy is comprised of 40.7% for Integrated O&G and 25.92% by O&G Exploration & Production.