Can anything alter Lafayette’s rosy trajectory? Well yes, a sustained slump in oil prices certainly can, along with a lack of opportunity for all of our citizens.
Nobody, and we mean NOBODY, has a crystal ball when it comes to what will happen with oil prices in the New Year. Read as much as you can from respected analysts and energy reporters across the country, prepare for the worst and hope for the best. Preparing for the worst in Lafayette means oil, which is already down about 50 percent over the past six months, will fall to $35 a barrel (as some commodity traders suggest the drop is only three-fifths done), and while that’s devastating for us, those prices could be a real boost to much of the rest of the country. That, of course, presumes that stock prices will remain resilient to the current oil price decline and not fall in line with them, as they did during the 2008 financial crisis.
Keep in mind that a major international event could send the price of this commodity soaring past $100 a barrel. We’ve seen that before. What will a slump in price do to the many billions of dollars in projects about to launch in Lake Charles — projects from which Lafayette and Acadiana are expected to get at least tangential benefits?
What we do know is that the Organization of Petroleum Exporting Countries, which has vowed not to reduce output, is likely playing a dangerous, manipulative game, with Saudi Arabia (OPEC’s leading producer) announcing in late December that it would not cut production, even if non-OPEC countries do. “If they want to cut production they are welcome: We are not going to cut, certainly Saudi Arabia is not going to cut,” Saudi Oil Minister Ali al-Naimi told reporters.
The question is, do we believe him? Only time will tell how long he’s willing to endure the pain if the price does not rebound. Meanwhile, let’s all try to be patient. Yes, there will be some suffering here, but we’ve weathered this storm before. We are, after all, in much better position to weather it than we were 30 years ago when our economy was far less diversified.
Lafayette remains deeply stratified economically, and the strata are thick and historically stubborn: There are a lot of haves and have-nots, and there’s little interaction between them. A 2013 national survey ranked the Hub City as the seventh most economically stratified city in the country. Few would argue we’ve done much in the last year to remedy that.
But remedy it we must. As long as there are pockets of decay within our city where crime is high and opportunity low, our collective progress will be impeded, the arc of our trajectory will be blunted.
Yet we’re bullish on Lafayette’s future, optimistic that the issues we face as a community — call them the growing pains of a small city becoming big — can be met squarely, honestly and with a shared sense of purpose. — The Editors