OKLAHOMA CITY (AP) — Overall collections by the state treasury dipped in August when compared to the same month a year ago, mainly because of a dramatic drop in revenue from oil and gas production, Oklahoma Treasurer Ken Miller said Thursday.
Figures show that, for the third time in the last six months, collections fell below those of the prior year.
“As with the two prior negative months, markedly lower gross production tax collections are the primary cause,” Miller said.
Overall collections for August totaled nearly $820 million, a decline of 2.8 percent from August 2011. The most notable drop was a nearly 54 percent decline in oil and gas production revenue compared to the same month last year — from $101 million in August 2011 to $47 million last month.
But Miller said that dip is being offset in part by gains in other revenue categories, including a 10.4 percent increase in sales tax collections and a 7.4 percent increase in motor vehicle taxes.
“For 10 of the past 12 months, we’ve seen the drop-off in gross production collections accelerate while sales and income collections have kept growing,” he said. “But because of the large impact of the energy industry on the state economy, it’s important to keep an eye out for spillover effects that may be attributable to weakness in oil and gas collections.”
Miller also noted that his figures on oil and gas revenue reflect a three-month lag time from production. Since then, the average price of West Texas Crude at Cushing has increased by about $10 per barrel, while the average price of natural gas has remained relatively flat. He said a shift in production of many wells from natural gas to oil could help stabilize that revenue source.
“There’s concern, but as the transition from natural gas to oil continues to take place and oil being relatively healthy and us having a few months’ drag on collections, that seems to show me that things are going to rebound and continue that positive trajectory that we see in our other revenue categories,” Miller said.