Even as the national economy went into a tailspin, resource-rich towns like Parachute, Colo., were doing fine. Then natural gas prices began to plunge, and the pain began to rise.
By Nicholas Riccardi
February 7, 2009
Reporting from Parachute, Colo. — Robert Knight was about to install wireless transmitters on eight new drilling rigs joining the thousands that dot the ravines and mesas here when he got the startling news: All but one of the rigs were coming down.
Falling natural gas prices had led energy firms to abruptly curtail their work here last month, battering the last sector of the U.S. economy that had prospered despite the recession.
“Boy, it was quick,” said Knight, who has a business installing communication equipment and who serves as the town manager. “It was like the difference between night and day.”
The sky-high oil and natural gas prices that burdened consumers during much of the decade were a blessing to residents of this tiny town and other energy-rich communities from Alaska to Arkansas. Even as the national economy went into a tailspin in early 2008, home prices in boomtowns like Parachute kept rising and the streets were packed with shiny new pickups.
But prices suddenly began to drop in September — natural gas is down 50% from its peak and oil has plummeted from a high of $136 per barrel to about $40.
The plunge brought some relief to recession-racked consumers, but has raised anxieties in Parachute, a town of 1,500 that bears the scars of busts that followed previous energy booms.
In better times, “you couldn’t find a hotel room, you couldn’t find a campground, you couldn’t find a place to rent,” said Laura Diaz, the town planning clerk. That’s changing fast.
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