We live in strange times when the world's largest publicly-traded oil company, Exxon Mobil, posts a staggering record $14.8 billion third-quarter income, yet its shares still falter.

The U.S. oil and gas industry has always been a rollercoaster ride, particularly here in the Rockies where they still say, "Bust follows boom like night follows day." Yet, few are prepared to say the sun is setting on Wyoming's 10-year-long boom.

"If the economy tanks, then yeah, it's a bust. If China and India's economies slow and don't come back, yeah, it could be," said Bruce Hinchey, president of the Petroleum Association of Wyoming.

For now, the crisis has been too short-lived to make those long-term projections. Five years ago, few would have guessed that oil dipping below $70 per barrel would be cause for concern.

Even before the credit crisis of late, oil and gas producers read indications of an economic downturn. Their spending budgets will likely shrink next year. The severity of the impact of the economic crisis on oil and gas drilling will depend on how long the national and global economic slump lasts, depressing demand.

That story will play out over the next few months.

"Usually it takes six or eight months for (a decline in demand) to have much of an effect on drilling," said Hinchey.

Companies contract rigs months ahead of time, and freshly issued permits must be acted upon before seasonal stipulations close the drilling window in many areas of the state.

Drilling is down only 1 percent from this time last year, according to the Wyoming Oil and Gas Conservation Commission. OGCC supervisor Don Likwartz believes drilling activity may drop off this winter, but some current operations are based on long-term drilling programs.

"We might not see as big of a drop-off as other states because of the specialty rigs in Jonah and the Pinedale Anticline," said Likwartz.

Those two fields make up more than half of Wyoming's drilling.

State economists estimated revenue from 2008 oil production based on an average $90 per barrel. That should hold, according to Likwartz, because oil averaged just under $100 per barrel for the first eight months.

However, the state's estimate of $75 per barrel for 2009 might have to be adjusted in a few months.

Mixed coal signals

How's this for mixed messaging on Wyoming's energy industry? The same time Peabody Energy announced plans for production from a new coal mine in the Powder River Basin next year, Arch Coal announced it would idle one of five draglines at its Black Thunder mine in the basin.

It's an odd bit of drama given that the news of the idled dragline came on the same day Arch announced strong third-quarter profits. It amounts to shutting-in a well in the oil and gas industry then opening it back up when the price increases.

The important thing here is production capacity. Arch isn't cutting any at Black Thunder. Officials said there are no plans to dismantle the dragline and haul it away. So when coal prices come back up, production can crank back up in a short amount of time.

Meanwhile, 200 miles away in Carbon County, Arch has quietly begun shipping loads of coal from its previously idle Elk Mountain property for customer test-burns. Arch is an investor in DKRW, which plans to build the Medicine Bow coal-to-liquids plant in the region, and has an agreement to supply coal to the operation.

Amid the credit crunch, however, DKRW announced construction would be pushed back. Arch could still decide to ramp up coal production anyway.

"Whether we decide to proceed with full-scale development of those reserves - and when we might do so - depends on future market demand for this new coal product," said Arch Coal spokeswoman Kim Link.

Energy reporter Dustin Bleizeffer can be reached at (307) 577-6069 or dustin.bleizeffertrib.com.