'Too Early to Know' How Oil Price Cuts Will Affect Oklahoma

Mar 9, 2020

Credit File Photo-OU

A steep drop in oil prices that sent financial markets plummeting Monday got Oklahoma officials’ attention.

Saudi Arabia is seemingly trying to force Russia into production cuts to keep oil prices up for the long term. Oklahoma Deputy Treasurer for Communications Tim Allen said they're paying attention but can't yet predict how the move will affect Oklahoma.

"It is too early to know what kind of impact this is going to have on the state budget. We don’t know how long this situation will last. We don’t know where oil and gas prices are heading over the next few months," Allen said.

Any direct impact on the state budget will be delayed a few months.

"Oil sales that are going on this month will not be reported to the state until the end of May and will not, therefore, be allocated for spending by the state until June, which is the last month of the fiscal year," Allen said.

At around $34 a barrel, however, oil prices are significantly below what state officials assume in building Oklahoma’s budget, and that’s spooked some at the capitol. Rep. Kyle Hilbert is being cautious with his bill to potentially give out more in income tax credits for adoptions.

"Title is off the bill, especially with the news over the weekend of oil prices tanking. Definitely going to be watching that as this moves forward to make sure before restoring title that it’s something we can do," Hilbert told fellow lawmakers Monday before they advanced House Bill 3086.