The Ups and Downs of the Oil Industry

I may not know everything, but I do know a little about the oil industry. I’ve worked in the oil industry since I was about 14 years old. One of the main things investors need to understand about the oil industry are the cycles it goes through. Coming from a small town that depends completely on the oil field for survival and prosperity, I can tell you that it goes up and down at random. When its up, there is more money to be made than you would ever imagine. When its low, it can be hard for small companies to survive and grow.

Just like anything, business in the oil field is a relationship business. Companies tend to seek to build solid relationships with new clients and produce quality and timely work as to remain in business. Most businesses in the oil field are conscious of the ups and downs and know that the only way to remain solid in tough economic times is to produce their best work.

For example, in Minnesota construction companies are effected by the oil industry indirectly. When the oil feild is booming, new people are moving in, which brings in the buying and building of houses, which increases the size of the city, so restaurants start getting more business, etc. Everything is tied to the oil field when it is the major driver of a city.