Moody's Turns Gloomy On N.D.

Moody's projections for oil prices are already public, and it doesn't take a rocket scientist to figure out what it means for North Dakota.

Slightly late to the realization, the state of North Dakota is finally asking its economic consultant for a new forecast that will be delivered in January or February to lawmakers.

At the same time, what appears to be a direct rebuttal to an editorial last week, Moody's is sounding the alarm on North Dakota's economy saying that the state could be in trouble and needs to prepare for a full blown recession.

While some papers' editorial boards will call this sort of thing "chicken little thinking" the fact is that this is the company that the state's leadership has chosen to rely on for over a decade.

On CNBC today, the report is that Moody's is lowering it's price target to an average of $40 for 2016.

Going further, according to Moody's press release, for 2017 and 2018 they are now putting the price estimates at $45.

This means the state of North Dakota needs to prepare for having over 20% less oil tax revenue (when combined with the oil tax rate reductions passed in 2015).