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North Dakota treasury benefitting from higher oil prices

November 17, 2021 GMT

BISMARCK, N.D. (AP) — Climbing U.S. oil prices that have motorists paying more at the gas pumps are adding to North Dakota’s bottom line.

The state’s oil production was up slightly in September, but prices for North Dakota crude were 32% higher than the state’s tax revenue forecast.

New data shows North Dakota produced 1.1 million barrels of oil per day in September, up 0.5% from August. The state’s natural gas production was stronger, up 1.8% from the previous month, the Star Tribune reported.

U.S. oil prices have climbed in recent months to around $80 a barrel, hitting highs not seen since 2014.

“U.S crude stocks are really low — they are at the bottom of their five-year average,” Lynn Helms, North Dakota’s mineral resources director, said Tuesday.

Those low inventories should continue to support high oil prices unless there is an “OPEC surprise” or a significant increase in the cartel’s production, Helms said.

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On the flip side, “we are not going to see relief in gasoline or diesel prices,” he said. “Sorry, consumers.”

In Minnesota, gas is averaging about $3.17 per gallon, up from $1.95 a year ago, according to GasBuddy, a price-tracking firm. North Dakota’s average is $3.19 while the national average is $3.41.

Stronger oil prices have increased North Dakota’s oil rig count, an indicator of new production. The number of rigs deployed has risen from 27 in September to 29 last month and 34 in mid-November — “the best since the pandemic,” Helms said.