Not to mention the crunch it would put on the state’s economy.
So is there reason to be alarmed? Or is this dip in prices just a speed bump?
Harold Hamm, the CEO of Continental Resources and perhaps the biggest player in North Dakota’s Bakken oil fields, is leaning towards speed bump.
“Obviously the price of oil has tagged bottom,” Hamm told KFYR radio host Scott Hennen todya. “It’s actually rebounding. I think the oil price is going to be in the $90 range pretty quickly.”
So what caused the price dip? Hamm says the market was overreacting to Saudi threats to flood the market with oil
“The market had reacted to the rhetoric the Saudis put out,” Hamm said. “I think there’s universal agreement that the Saudis don’t have the production capacity to impact the price oil in the manner they were talking about. They can’t dictate the price of oil lower any more.”
Hamm says the Saudis are not so much motivated by a desire to undermine American oil production, but rather to the Russian/Iranian alliance.
“I understand the Saudis motive. They’re very concerned about the nuclear situation in Iran. They’d like to slow down that process…and also take a swipe at the Russians as well who are backing the Iranians.” Hamm said. “Nevertheless I think they’ve overplayed their hand…in the fact that they just do not have the production capacity to impact the market in that manner.”
Meanwhile, it seems the market is already reacting as Hamm predicted. Oil prices already seem to be rebounding. So, perhaps North Dakota will be fine in the coming months, but this little scare is a reminder that these boom times in North Dakota are not necessarily the new normal.