Long article in the WSJ today shows petroleum engineering student enrollment has fallen 75% despite high prices and stratospheric starting salaries. Young people do not like filthy industries destroying the planet and/or do not see a future there. Companies are struggling and offering ever higher salaries, to no avail.
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Good. Higher salaries for me and the other new PE grads.
@ezzs, if you figure out that timing, you should apply that to the stock market!
Don't worry about the college 'kids', in today's information world they're on top of everything. The last decade of successive busts, coupled with the increasingly bad PR about the oil industry (ever seen MW or any of our senior management visit college campuses to talk up the industry?), has resulted in the tailspin of university enrollment in petroleum-related careers. Professional organizations like AAPG and SEG are in membership free-falls, largely due to Boomer retirements but also lack of student interest (in other words, they're getting cut at both ends). Even the more secure SPE has seen a 20% drop in membership the last five years. As they say, "bad news travels fast".
The problem is how do time your graduation with an upturn ? If you are successful in doing so you can enjoy a high salary for a while (after you turn 40 you are layoff fodder).
Btw … someone should paste this thread on college bulletin boards, the kids should know what’s is store for them.
@dldu and @crwk both correct. PEs will be in high demand, as long as you're skilled enough and crafty enough to avoid layoffs. It will be a dwindling population, though. At retirement, you can reminisce about your career just like carburetor mechanics and VCR technicians.
@cqyi is also correct. Petroleum is rapidly losing favor in US universities, Geo departments are either disappearing, or re-tooling for environmental careers. My alma mater did that, that was the point I stopped my alumni donations.
PE degrees will remain in high demand even as oil production begins to decline over the next decades for other applications like carbon sequestration, heavy mineral (brine) extraction, hydrothermal, and much else that involves subsurface production of fluids. That so few are now enrolling indicates that those now getting PE degrees will be in high demand. Following the herd leads to a cliff more often than blazing your own trail.
TAMU is lucky to still offer PE degrees as most university's have shut down their program do to lack of interest from students.
Petroleum engineering is a very specialized discipline and a PE degree does not have much transferable skills outside the oil industry. If you study 4 years to get a PE degree and can't get a job in the oil industry, you are kind of screwed.
Excuse me, sir. I recently graduated from Texas A&M with a degree in Petroleum Engineering. May I have a job at Tesla?
For the fall semester at Texas A&M University only 49 students applied for Petroleum Engineering. 587 for Mechanical Eng and 598 for Computer Science.
@arpq, I'm not sure if there's meant to be any sarcasm in your comment, but if you played your (financial) cards right, you're now very comfortably retired, and glad to be away from what is now a largely ignored, ghost-town BU. That was half of what I meant by "really, really lucky". The other half was that we got to do some cutting-edge (for the day) science, got to drill a lot of wells, spend oodles on lease sales and seismic, got to add impact reserves to the company (not 4-6P stuff like the rest of upstream), and were the envy of the rest of the company. Working those long hours was because we wanted to succeed (and for the most part, we did), not because anyone was forcing us to. Australia in the 90's was the same thing. You can see the same lifecycle playing out in Permian, although it looks like they're just about plateau'd out after 7 years.
Yes, I was not only lucky but extremely fortunate to have been given the opportunity to work my A$$ off for over 30 years. Thanks!
@9kgp, you're absolutely right. Lots of analogs and precedents out there: copper, iron ore, coal, lobsters, diamonds, hardwoods, even whale oil. Massive, low-cost early discoveries (in oil, Spindletop maybe through the North Sea discoveries in the 1970's) give rise to more difficult, more costly discoveries (deepwater, subsalt, fracking shales) with smaller payoffs and shorter lifespans. Technology will stretch this out a little, but never get you back to those early salad days (we saw that in the Gulf of Mexico Shelf before divestiture, and we're seeing that in the Permian already). The reason we've seen deepwater Gulf of Mexico activity drop to near zero (all you read about now is smallish discoveries only economic if they can tie back to existing infrastructure, and lease sales like used-car-lot auctions) is that there are literally no prospects out there sizeable enough to support $$$billion development costs. Anchor may be the last of the really big development projects, which date back to the latest 1990's. Those DWEP people who worked in that roughly 25 year period were really, really lucky.
Peak oil prediction: yes we have all heard these failed prediction throughout our careers, but the predictions always failed due to not understanding technology advances. No one “saw” ultra deep water production or, in turn, shale fracking, and both radically changed reserves forecasts. My question now is what’s on the horizon: seismic images are about as good as they can get, and most major basins have been explored. So what is left? The Arctic? Sub salt? Improved thermal recovery? Sufactent floods? Some new technology not yet dreamed of? Sure there are decades of production in already identified reserves and play offsets, but not a lot a room there for real long term growth.
Many industries in the volatile high-paying sectors "always have a layoff around the corner" It was that way for many of us for decades before we could comfortably retire. That's not unique to oil & gas, that's a property of high-earning careers. It seems that some of you need to grow a spine or get a different job.
The big issue is the oil industry keeps laying off. Who wants to constantly have a layoff around the corner?
Just a reminder. Oil consumption is 1MM BOED higher now than before the pandemic. I have heard incorrect predictions of peak oil my entire life. Its really the only consistent thing in the oil industry.
It depends on my location. Coal is still used in many parts of the world and many cultures need it to survive. And it's use in those places is expanding, not decreasing. Think "Emerging Markets" if you're into investing.
Would you start a job in coal?
Yes demand is there, but western countries (and it’s companies) are driving away from fulfilling it.
Look at the money being poured into Iran/Iraq/Saudi to expand production. That is the future, IOC’s will slowly transform or fade away.
EIA says demand for oil this year has grown to an all time high. And will go up again next year. No signs anything is declining. Or even leveling off, any time soon.
Oil will not be gone, but life in a declining industry is simply not as fun as riding a growing wave. For those just starting I would recommend living on half your salary (which is not hard as this indistry still pays well for now). Even in times past most in this indistry were layoff at least once over their career and in future it will just become more common.
False
Humans are so logical. Oil will be gone in a decade and so will the industry. You should always sell when things look rough and only buy when times are amazing.
Like most things young people believe, they believe it because they were told its true. Its sad that as a country we have poisoned the minds of our bright young people against the energy the fuels our economy. The world will use hydrocarbon liquids for a very long time. Its too bad the US will become more dependent on foreign countries to provide them.
Clear message is that if you're under 50, you better have some sort of plan B ready to finish out your career. Those under 40 better have some transferable digital skills, and I don't mean Excel or PowerPoint. Those under 40 describing rocks will go the way the paleontologists and gravity-mag people disappeared 20 years ago - a tiny community of consultants occasionally needed.
The Chevron “hunger games” system is designed so that they can perform any “- ism” they want. That’s what the high paid lawyers are paid for.
When Chevron laid me off in 2016 after 27 years of service and at 56 years of age, I just couldn’t find work in the energy industry anywhere here. Ageism is a serious problem in the United States. I looked into energy sector jobs overseas in Europe and within a short period got hired by Repsol (Spain). It’s a great integrated oil & gas company with many young engineers, but with just as many older professionals like me. Repsol and many other European companies actually value experience as a strong and valuable asset, whereas in America it’s quite the opposite.
Post from TheLayoff.com
If US recruiting lags, companies will bring in Nigerians, Indonesians … open centers in Dubai , india.
Seems like today's generation is trading oil wells for well-oiled algorithms. They are betting on sectors like tech, finance, and management consulting, where the prospect of higher lifelong earnings and dynamic work outweigh the short-term salary booms of traditional industries. While petroleum may still fuel our cars, it's no longer fueling career aspirations.
When on top of all the climate and environmental concerns you constantly lay off your employees to give your shareholders a bigger cut you aren't going to attract many younger people. Management of oil companies are doing this to themselves with their greed.
Maybe so for US and Europe but still the green dollar attracts for students.
Horrible industry. No company loyalty. Not a lot of good bo-m cycles left. The industry is not going away but the “ways” of the US majors in the last 10-15 years will. 20 years ago the ways were different they wanted people to make decisions and play hard. 10 years ago the shift started to happen and today we are left with people who can not make a decision or put there name on the line for anything. A lot of this happened with unqualified non technical people got promoted to build the industry seem nice to the younger generation
Trust me when I say that an oil company can not sustain this during normal times. During good times you can cover up a lot with cash but normal to bad times are when things get exposed.
@eee+1, yup. There's only maybe two handfuls of US universities still offering petroleum-leaning geoscience and engineering degrees. The rest have seen drastically reduced enrollment, no industry support anymore, and green pressure not to support the industry.
@xlp, correct. All the rest of the petrotechs will be gone, PEs will still be around, and eventually will turn off the lights. Look at the smaller companies (particularly those in the Permian), they are top-heavy with PEs because that's what works when margins are tight.
Without petroleum engineers we are doomed. All the greatest MBAs and attorneys and managers are useless if we can’t figure out basic reservoirs.
If they do not like filthy industries destroying the planet who's going to strip mine for my Tesla Batteries? Waah Wahh Waaaaaaah!
Why would you want to work beyond mid 50s? Everyone I know retires by then unless they are remarried or something.
Chevron promises to reward their Human Energy, and they do until you hit mid 50s and you cant get 2+, let alone 1 on your reviews. I would look for an industry that will keep on tewarding you to at least 65.
Prices are cyclical but in the past when prices rose, college enrollment followed them up (and down). Not so anymore. Petrotech education is kaput. If you are smart enough to get an engineering degree you can work out that oil is dying.
Oil field is a rough job. The industry is very cyclical. If you can make a career in the oil patch and not be out of work at some time then you are the exception not the norm.
There is along future for the oil industry but it will be dominated by Saudis, Brazilians, Venezuelans who will all protect their industry and jobs from outside interference.
The western oil industry is finished, eventually margins will compress, the lawyers will pick at the carcass and society will treat us like garbage.