Refining profits typically rise as crude prices fall, since oil product prices lag and fall more slowly. However, both gasoline and heating oil prices fell along with crude in December, leaving margins unchanged and at the low levels of recent months. December refinery output was high, with capacity close to 100 percent in Texas and Louisiana. Industrial activity remains strong, fueled by substantial levels of speculation. The office market continues to improve, and ground has broken on new office buildings in Sugar Land and The Woodlands.
Retail activity is flat.
A shortage of construction workers constrains current building activity. Framing crews, carpenters, estimators and project managers were all cited as difficult to find. These skills can't be produced quickly through training programs, and there is no region of the nation whose economy is weak enough to provide a surplus of workers. For a copy of this publication, write to Bill Gilmer, Houston Branch, Federal Reserve Bank of Dallas, P.O. Box 2578, Houston, Texas 77252. This publication is available on the Internet .