Oil Layoffs Followed by Increased Criminal Behavior

Drilling rig/Getty Images

Drilling rig/Getty Images

The increasing level of unemployment accompanying the oil and gas downturn has been met with an unfortunate increase in oil theft. Disgruntled, downsized employees have a significant role in the illegal extraction and transportation of crude oil and other industry related goods. John Chamberlain of the Energy Security Council stated that there are “…unemployed oilfield workers that unfortunately are resorting to stealing,” Certain criminal organizations lure laid-off employees because of their onsite experience. These illegal groups know that the employees have knowledge of the oilfield operations and, therefore, work with them for the purpose of developing ways to extract and transport the oil out of the site without drawing attention from security or other workers.

This is made somewhat easier by the fact that some companies have been forced to cut back on the number of security guards on site, which enables the criminal behavior. “There are a lot less eyes out there for security,” noted analyst John Esquivel of Butchko Inc., a company that creates security solutions for businesses. A lack of oversight allows for easier access to the site and can result in the improper use and transportation of goods. The situation becomes worse when there is an atmosphere of carelessness, which can lead to heightened levels of illegal occurrences. Activities such as leaving a vehicle’s key in the ignition or failing to accurately keep track of onsite goods only make it easier for illegal activity to go unnoticed. Companies could benefit by developing programs that attempt to counter these types of criminal-enabling activities.

Thievery in the oil business in nothing new: it has been occurring ever since the industry started making money. The fact that there is theft going on is not a real shock to anyone. However, the rate at which these thefts have been occurring requires some sort of internal- examination on the part of these companies. Companies often do not report these kinds of events because it is usually too late to track down the goods by the time it has been made known that the items are actually missing. The criminal groups are efficient: they sneak into a site, steal either oil or drilling components, and then proceed to transport these goods elsewhere to be sold on the black market. It would be worthwhile to look into developing new logistical metrics that would more accurately keep up with the extraction and transportation of oil and the goods used to extract the oil.

Consider the type of skillset that many of these employees have developed working in the field. A lot of upstream oilfield workers find success through hands on experience in the workplace. An employee with a strong work ethic and an ability to learn on the job is seen as very valuable. However, while these employees might be developing skills valuable to the oil industry, they aren’t getting enough exposure to tasks that are applicable outside of the oilfield. Certainly there are tasks performed which are not unique to the oil industry. Many of the skills developed while working in the oil industry are greatly valued in a number of fields. But some employees, whose exposure to inter-industrial skills are limited, find themselves struggling when the oilfield takes a turn for the worst. When the industry is not booming there is a limited amount of work outside of the oilfield that is left for these individuals. This could very well be another contributing factor as to why theft increases with unemployment: these workers cannot easily find another source of income, and stealing using what they already know is both easy and enticing enough to ensure their cooperation.

Article written by HEI contributor Timothy McNally.

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