Yesterday, citing SARS-CoV-2 (COVID-19) downturns, coal mines in Campbell County laid off 300 workers.
That may sound like a pretext, but it isn't. The Burlington Northern is now several years deep into furloughs now due to the Pandemic and it looks like it's getting worse. There's been a giant downturn in demand for coal as people aren't buying and they aren't working.
As the shelter in place orders extend into the Summer that might actually change, if they do. Or it might just change either way. If people go back to work in the next month or so, the demand for energy may go up. If they stay home, the demand for energy may also go up as Americans can't live without air conditioning anymore.
No sweaty rear windows, like in Rear Window.
Anyhow, coal demand actually has gone up in the summer in recent years, the opposite of what it used to do. At one time the Government, in times of crisis, urged people to buy their coal early for the winter. Now it doesn't do anything like that at all, as its power plants, and not individual people, who normally buy coal, but the demand goes up in the summer.
World War One vintage poster urging homeowners to buy coal early for the winter.
We'll see what happens, but right now, reeling Campbell County has been given an additional blow. Three Hundred layoffs in a county that already was hurting, on top of COVID 19 shut ins, and a slow down in the oil and gas industry is a giant blow.
Coal, as we've noted before, has been on a long slow decline for many years. Over a century in fact, but with events like this, a person has to wonder at what point things simply become fatal for Wyoming's coal mining industry. Once some things close (and that speculation can extend a lot further than just on coal mining and Wyoming) they don't open back up.
One thing that isn't going back up, at least very quickly, is oil.
West Texas oil opened today at around $17 bbl. People who take a rosy view of situation have been stating that we ought not to worry, it'll rebound. Indeed, they were saying that it would rebound significantly this week.
It hasn't.
Now, it will sooner or later, to be sure. But it isn't quickly and if the economy slumps into a deep recession, and there's real reason to fear it will, it won't for months.
Added to that, as we've also noted before, it seems that consumption of petroleum entered a new phases some years ago. The original problem was the high price combined with a seemingly insatiable American demand. However, technology allowed the US to become an energy exporter again (which is now threatened by these developments) while, at the same time, Americans seem to have broken up with the car. While breaking up with the car, they also developed an interest in electric vehicles and that hasn't gone away and isn't going to. While a drop in the price of oil would seem to threaten to change that, it doesn't look like it will.
Even Jeep, on Earth Day, came out with the news it was introducing an electric Jeep. Jeep drivers, of which I'm one, are the most bound to tradition drivers in the world, but it looks like they're ready to accept an electric version, massive "you can't do that and it won't work" reaction aside.
So, this might not only take a long time to turn around, it might take a very long time.
As we earlier noted here, what should be going on right now is a massive buy up of the cheap foreign oil as a strategic reserve by the U.S. government, but it doesn't appear that will occur. The government is buying some, but not at the level it really needs to in order to address the situation.
It does want to buy Uranium, however.
If there's a bright spot for Wyoming in this economic picture, that's it. The Federal Government is wanting to buy Uranium for a strategic stock piles.
The American Uranium industry has been really hurt, like oil is being right now, by cheap foreign supplies. It's also being hurt by an absolutely misplaced fear of nuclear energy which Greens ought to be ardently embracing. We'll deal with that some other time, but the price of Uranium is low and the once vibrant Wyoming mines are mostly gone At least one lingers on and a Federal program to stockpile, if it occurs, will aid that sector at least a bit.
All in all, however, it's really a perfect storm.
