Marisol Solis is a student at Rice University. Oil and natural gas markets have been the center of local economic interest in recent weeks. Petrochemical markets look weak compared with their record performance in 1995 but are rebounding from a poor first quarter. Refiners were hurt by a combination of stable crude prices and falling gasoline prices. Retail, auto, housing and real estate markets all show underlying strength.
Inventory is in good shape as dealers begin to clear their lots for the new models.
Retail sales are making small gains on a same-store basis, still relying on heavy promotions and discounts. Retailers are making planned sales levels this year, largely on the basis of more realistic sales forecasts, and inventory is under control. Prices have remained surprisingly strong, however, helped by continued low inventory, the substitution of oil for natural gas under industrial and utility burners and a demand for domestic oil products 2.5 percent stronger than last year. Domestic activity is up about 8 percent compared with last year, with Texas and Louisiana accounting for more than half of the increase. Offshore activity in the Gulf of Mexico remains flat because available rigs have been put to work, and all but four or five Gulf rigs are looking for natural gas.