By Dan Boyd | Albuquerque Journal
Despite a recent drop in oil prices, New Mexico economists are leaving unchanged a revenue forecast that projects the state will have $1.1 billion in “new” money – or revenue in excess of current spending levels – available in the coming budget year.
The surge in oil drilling in southeastern New Mexico has been the driving force behind a recent state budget turnaround, with taxes and royalties levied on the industry and related economic activity boosting state revenue levels to an all-time high.
Although oil prices have gone down in recent months, oil production levels have continued to rise – with the total number of oil rigs hitting 112 this month.
:“Oil producers in the Permian basin have significantly lowered break-even costs, meaning many wells can remain profitable at lower prices,” executive and legislative economists wrote in their revenue update that was presented Friday to members of the House budget committee.
