North Dakota Oil Pause Reflects Companies Seeking Higher Profits

UND economist says Continental Resources' drilling halt shows firms following the money amid low prices and rising costs

Jan. 28, 2026 at 10:47pm

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One of North Dakota's largest oil producers, Continental Resources, has halted drilling in the state for the first time in 30 years. Economists say the decision signals that companies are seeking higher profits amid low oil prices and rising costs, with potential tax implications for the state in the short term. The pause raises questions about whether companies can meet long-term productivity and profit goals at today's costs.

Why it matters

North Dakota is the third-largest oil-producing state in the country, so any pause in drilling activity could have significant economic consequences. The state and local municipalities may see tax revenue declines, and a prolonged pause could lead to workers and revenue leaving the state, making it harder to rebound when prices rise again.

The details

Continental Resources, one of North Dakota's largest oil producers, has halted drilling in the state for the first time in 30 years. UND economist David Flynn says the decision reflects companies seeking higher profits amid low oil prices and rising costs, such as transportation and extraction. While companies may still be making a profit, they may be more profitable working elsewhere.

  • Continental Resources has not drilled in North Dakota for the past 30 years until now.

The players

David Flynn

An economics professor at the University of North Dakota who commented on the economic implications of Continental Resources' drilling pause.

Continental Resources

One of North Dakota's largest oil producers that has halted drilling in the state for the first time in 30 years.

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What they’re saying

“When prices fall, companies don't necessarily lose money, but they start comparing where their dollars work best.”

— David Flynn, Economics Professor, University of North Dakota

“You're going to have that kind of volatility change behavior, and businesses have to respond. And this is the way Continental is saying the landscape is presented to them and how they're going to respond.”

— David Flynn, Economics Professor, University of North Dakota

What’s next

Economists will continue to monitor the duration of Continental Resources' drilling pause and its potential impact on North Dakota's tax revenue and workforce.

The takeaway

This case highlights how oil companies are prioritizing profitability over production, even in major oil-producing states like North Dakota, as they navigate low prices and rising costs. The pause raises questions about the industry's long-term viability and the economic resilience of regions heavily dependent on oil and gas.