Friday, March 6, 2015

Kudos to the Texas A&M petroleum engineering department once again

Dear Admitted Aggie PETE Applicant,  
The Harold Vance Department of Petroleum Engineering, Texas A&M University, is pleased that you applied and were admitted to our top ranked petroleum engineering program. If you pursue a degree in petroleum engineering, our program is committed to providing the highest quality education available.  
Recent data suggests that some concern about the sustainability of the entry level job market during a time of explosive growth in the number of students studying petroleum engineering in U.S. universities may be prudent.  
Our advice is that you become aware of graduation projections and petroleum industry employment outlook for people with petroleum engineering degrees. For example, between fall 2011 and fall 2012, the number of freshmen in petroleum engineering programs in the U.S. increased from 1,388 to 2,153, a 55% jump in one year. Based on the many inquiries and applications TAMU is receiving for the petroleum engineering major, the number of U.S. students in petroleum engineering will probably continue a strong upward trend, as long as the employment market remains stable. 
These days, a very large number of people are already studying in petroleum engineering programs (see attachment, showing data made available through the Society of Petroleum Engineers, SPE), at a time when: the number of recent graduates, who began their studies several years ago, is already at about historical highs and growing rapidly (see attachment); our program’s board of industry advisors are recommending that we “do not grow” our undergraduate program at this time; and oil and natural gas price projections and expectations of U.S. governmental policy influences are viewed as not particularly encouraging by the U.S. petroleum industry. 
Considering the layoffs happening in the oil industry, I want to take this opportunity to once again congratulate that department not only for their foresight*, but for their due diligence in looking out for their students and their long-term best interests.

[When do we think WTI will be back above $100? I say by December, but I am neither a soothsayer, nor a pessimist.]

*OK, it may not take that much foresight to recognize that there are boom-and-bust cycles in the petroleum industry. 

3 comments:

  1. Daniel PlainviewMarch 6, 2015 at 4:24 PM

    Right now, the futures price of crude oil is higher than the spot price, so oil companies are selling futures contracts and storing the oil. However, the storage facilities are filling up and if things don't change in the next couple of months, we will go from contango to supercontango and oil prices could take a sharp dive even further. When that happens, I wouldn't want to be a petroleum engineer, or work in the oil sector, or have investments that depend on oil companies, or live in an economy dependent on oil… oh crap.

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  2. Um, didn't you guys see the job report today? No mention of job cuts in the oil sector. Nothing to worry about!

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  3. Maybe academia should give out it's own loans and bet the appropriate interest on them...that might keep things in the correct equilibrium.

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