Treasurer: Oklahoma revenue collections hit 6-year low
Oklahoma's revenue collections hit a six-year low in May as the state's economy limps along during a slump in its key energy industry, Treasurer Ken Miller reported on Monday.
The report shows May collections were lower than those from May 2015 for every major revenue stream, including taxes on income, sales, motor vehicles and oil and natural gas production.
"As a general indicator of economic activity in Oklahoma, the ... report contains no surprises as the state deals with the ongoing spillover effects of the supply-driven energy industry downturn on income and consumption," Miller said in a statement.
It is the ninth consecutive month that 12-month gross receipts to the treasury are lower than those for the previous 12-month period, the report noted.
Oil and gas production tax collections rose slightly in May after hitting a 17-year low in April, but are still lower than May 2015 collections by nearly 37 percent. However, the reports note that May tax payments are based on oil prices in March, when the price for benchmark crude oil was around $37 per barrel.
U.S. crude oil topped $49 a barrel in trading in New York on Monday, its highest price so far this year.
The Oklahoma Energy Index, a measure of the state's oil and gas production economy, contracted in May for the 17th consecutive month with shrinking industry employment and a decline in drilling activity across the state.
Russell Evans, an economist at Oklahoma City University who helps develop the index, said industry activity has slumped as companies coped with the realities of a financial situation nearly two years on and just now showing signs of abating.
"As prices recover, exploration and production activity is expected to recover at a judicious pace," Evans said, "but even if the expected recovery materializes later this year, it may be some time yet before the state's economy returns to full strength."
Oklahoma's unemployment rate in April was 4.5 percent, an increase of 0.1 percent from the previous month, but still below April's national unemployment rate of 5 percent.