Wonder how the Oil Patch impacts the world economy? Dallas Fed is trying to find out

Tue, March 20, 2018

The Dallas Fed is setting up an Energy Advisory Council to help the Fed understand "emerging trends and issues" in the energy sector. In recent years, Dallas Fed president Rob Kaplan has pushed to make his location an important hub for research into the economics of oil and gas.

Houston is known as the nation's energy capital thanks to its refineries, port, corporate headquarters and operations centers. But the Dallas area is home to energy powerhouses (Exxon Mobil, Energy Transfer Partners and others) as well as financiers fueling the nation's oil and gas expansion.

"The Dallas Fed plays a unique role in conducting economic research and provides key insights into the impact of the energy sector on the U.S. and world economies," Kaplan said in a statement. "The concentration of superb energy-related companies in the 11th District provides us with a unique perspective which helps inform our research as well as our views on the global economic impact of the energy sector."

The 11th Federal Reserve District, based in Dallas, covers Texas, southern New Mexico and northern Louisiana (the nation's Nos. 1, 3 and 9 oil producers, respectively). 

Texas' crude oil production is more than triple that of No. 2 North Dakota. Also, Texas leads the nation in natural gas production and is home to about 30 percent of U.S. oil refining capacity, according to the U.S. Energy Information Administration. 

The new seven-member council includes representatives from oil and gas drilling, refining, oilfield services, finance and analysis. The initial group, which could be expanded to 10 members, did not have representatives from the renewable sector.

Since taking over as the Dallas Fed president in 2015, Kaplan has expanded the district's energy research efforts. The number of energy economists doubled from three to six, and local Fed staff created a monthly report of energy indicators and survey oil and gas firms in the 11th District.

The Dallas Fed has also collaborated with the Kansas City Fed to create annual energy conferences. Kaplan was also a keynote speaker at last week's CERAWeek, an annual energy conference packed with industry heavyweights.

The members of the Dallas Fed's new Energy Advisory Council are: Maria Claudia Borras, president and CEO of oilfield services for Baker Hughes (Houston); Tim Dove, president and CEO of Pioneer Natural Resources (Irving); Joseph Gorder, chairman, president and CEO of Valero Energy (San Antonio); Tim Leach, chairman and CEO of Concho Resources (Midland); Gary R. Petersen, managing partner and founder of EnCap Investments L.P. (Houston); L.E. Simmons, chairman of SCF Partners (Houston); and Daniel Yergin, vice chairman of  IHS Markit (Washington, D.C.).

Also, members of Dallas Fed boards who were invited to participate were: Curtis Anastasio, chairman of GasLog Partners (San Antonio); Greg Armstrong, chairman and CEO of Plains All American Pipeline (Houston); Albert Chao, president and CEO of Westlake Chemical Corp. (Houston); Richard D. Folger, managing general partner of Colbridge Partners (Midland); Paul L. Foster, director of Andeavor and former chairman of Western Refining (El Paso); Mary E. Kipp, president and CEO of El Paso Electric (El Paso); Cindy Taylor, president and CEO of Oil States International (Houston); Paula Gold-Williams, president and CEO of CPS Energy (San Antonio); and Darryl L. Wilson (Houston).