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Data: Federal Reserve Bank of Dallas; Chart: Sara Wise/Axios

A Dallas Fed report helps put the oil industry's response to the price and demand collapse into historical context. They find that U.S. producers' capital spending will decline by at least 35% in the second quarter en route to an even steeper annual decline.

Why it matters: That's bigger than declines in the 2008-2009 financial crisis and the oil price collapse in the mid-2010s (check out the chart above).

  • The number of drilling rigs deployed, which is a metric of current activity and future output, has greatly slid.

Don't forget: Prices also remain far below profitable levels for wide swaths of the distressed sector in the U.S. and elsewhere.

  • A separate Dallas Fed survey of energy companies in their region found that prices needed to cover operating expenses at existing wells averaged $23 to $36 per barrel.
  • And the surveys from the Dallas Fed and the Kansas City Fed (which covers producing states including Colorado, Wyoming, and Oklahoma) show prices are nowhere near what's needed to profitably drill new wells.

Meanwhile, job losses are piling up. The Houston Chronicle reports that another 1,000 job cuts in the industry were announced in Texas just this week.

Go deeper

Dion Rabouin, author of Markets
Aug 17, 2020 - Economy & Business

The Fed is back in focus amid Congress' stimulus impasse

Fed Chair Jay Powell. Photo illustration: Aïda Amer/Axios. Photo by Samuel Corum/Getty Images

Even though the Fed's policymaking committee has no meeting scheduled until mid-September, more attention is turning to the central bank as inflation has begun to pick up and Congress left town without delivering a new round of fiscal stimulus.

Why it matters: Since its unprecedented intervention into financial markets in March, the Fed has been seen as the driver of financial markets — holding up stock and bond prices through its massive bond-buying programs.

Scoop: Biden weighs retired general Lloyd Austin for Pentagon chief

Lloyd Austin testifying before Congress in 2015. Photo: Chip Somodevilla/Getty Images

Joe Biden is considering retired four-star general Lloyd Austin as his nominee for Defense secretary, adding him to a shortlist that includes Jeh Johnson, Tammy Duckworth and Michele Flournoy, two sources with direct knowledge of the decision-making tell Axios.

Why it matters: A nominee for Pentagon chief was noticeably absent when the president-elect rolled out his national security team Tuesday. Flournoy had been widely seen as the likely pick, but Axios is told other factors — race, experience, Biden's comfort level — have come into play.

Updated 29 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: WHO: AstraZeneca vaccine must be evaluated on "more than a press release."
  2. Politics: Supreme Court backs religious groups on New York COVID restrictions.
  3. World: Thailand, Philippines sign deal with AstraZeneca for vaccine.
  4. Economy: Safety nets to disappear in December Black Friday shopping across the U.S., in photosAmazon hires 1,400 workers a day throughout pandemic.
  5. Education: National standardized tests delayed until 2022.