‘It has got to the point where I run into old friends and ask them whether they’re in work, almost as a greeting. It’s become the same as asking ‘how are things?’,’ says oilfield safety worker Spencer Owen.

‘In Aberdeen just having a job answers a lot of that question.’

After months of dragging oil prices the capital of North Sea oil is caught in the grip of a vicious downturn which has wrought financial pain throughout the local economy. Dips are to be expected of a city so deeply dependent on the fluctuating price of oil, but the latest downturn is unlike anything its 195,000 residents have seen before.

The oil price rout has run deeper and longer than any oil market downturn in history, and comes at a time when the aging North Sea basin is losing its economic edge against cheaper exploration areas.

As the economic contagion spreads through Aberdeen, so do the anecdotes of its fall from one of the richest cities in the UK to a city in crisis.

Tales of oil executives queuing up for food banks or to sell their Rolexes to overwhelmed pawn brokers are breathlessly repeated by cab drivers. One tells of how financed sports cars are being abandoned in dealership forecourts overnight by those unable to keep up with payments. Another claims to have driven an enterprising young man to snap up a paid-in-full Porsche from a desperate owner to re-sell at a profit in London.

“I’ve been driving people from the Aberdeen airport into town for almost twenty years so I’ve seen downturns before. This one is different,” says one driver.

“Aberdeen keeps emptying out. My takings are down easily 50pc and it’s the same for everyone. Hotels, restaurants, shop keepers. At peak traffic times it would take me over an hour to get across the length of Aberdeen but I can manage it in half an hour now. There’s just no-one here,” he says.

Official city statistics show the estimated population of Aberdeen City is now 15pc smaller than before the oil market crash. And visitors through the airport were 17pc lower in January meaning far fewer people on the rain swept streets.

The signs of $100 a barrel oil remain: designer stores including Michael Kors and Hugo Boss gleam alongside Apple in the glass-fronted Union Square shopping centre. But further up Union Street the empty office space and shuttered stores are a bleak reminder of the sub-$30 a barrel lows hit in January this year.

After almost a decade of steadily rising oil prices the change in fortunes seems to have caught the credit-generation off guard.

Mr Owen is in his early thirties and lives with his wife and two children in Aberdeen, where he grew up. His friends say he’s lucky to be back in work after losing his job in 2015.

“I’ve always lived well within my means, but that’s not necessarily the norm here when you’re used to a big salary that keeps getting bigger,” he says.

In Aberdeen oil workers on lucrative contracts continued to live like pre-recession City Boys for years after the financial meltdown. Mr Owen details a list of vices which is eerily similar: mortgages on expansive properties, a new car every six months to a year, big nights out and far-flung holidays abroad.

“It’s easy to look back and say people were setting themselves up for trouble. But that was normal for a lot of people for a long time and there was no problem with living like that,” he explains.

“It used to be pretty common to interview for a new job, land an offer that’s 10pc higher than your current rate, and tell your employer to beat that offer to keep you. You could boost your salary quite a lot for doing little more than a one hour interview.

“Now I hear colleagues talking at the water cooler about how they’re having to learn to cook for their boyfriends. The high-paid jobs are gone so they can’t go out for dinner all the time,” he adds.

For many the impact of the downturn is more serious than the need to swap one of Aberdeen’s many deserted fine dining restaurants for a home-cooked meal.

According to rating agency Moody’s mortgage arrears in Aberdeen have spiralled to double the national level and could rise further as volatility in the UK’s oil industry increases unemployment and dampens house sales.

One estate agent who quickly asks not to be named says:

“They’ve just had it way too good for way too long.

“Rent keeps falling but we still have people who aren’t able to pay. It’s unpleasant for everyone. A lot of landlords depend on their rental income, which is a lot lower now than it was. But you never want to throw a person out.

“A two bed flat in some of the better parts would have been about £1,300 before the downturn but you’d only get £900 now.”

Cheryl Horne is no stranger to the shifting fortunes of Aberdonians. For the last 25 years she has worked as a personal financial advisor in the Granite city, and now spends much of her time helping those left jobless by the downturn.

While the rest of the city grinds to a standstill the independent advisory firm she works for in central Aberdeen has never been busier, she says.

“I’ve seen it all before – oil downturns, the financial crisis – but it’s never been this bad, not even in 2008,” she says.

“A lot of the people coming in having lost their jobs are older. They have a lot of experience but they were on large salaries, and now they’re facing an earlier retirement than they expected. We’re doing a lot of re-mortgage work and adjusting pensions to help people to get by.”

Her husband, an oil worker for the last thirty years, is one of the many left jobless by the market collapse. After months of unemployment he has taken a job with a major oil company in London and commutes back to Aberdeen on the weekend.

It’s not easy, but he’s luckier than most.

Within a year of oil prices beginning to slide, UK oil jobs dropped by 65,000. Now, almost two years after the start of the oil price rout the oil industry is estimated to be hemorrhaging around 150 jobs every day which by the end of the year could lead to a decline of at least a quarter from 440,000 before the crash.

High profile job culls have been carried out by all majors oil explorers and services companies, across their global operations. But Ms Horne suspects there have been far more jobs cut than are reported in the press. Companies are quietly sacking one or two people at a time, week by week, to avoid criticism in the media, she says.

“It’s quick and brutal. People with decades of experience are arriving at work to find a box on their desk and then you’re gone,” she says.

Wood Group, which provides services to platforms across the North Sea, axed 1,000 UK jobs last year as part of a 10pc cull of its 45,000 global workforce. Since then the company has slashed rates for its remaining contractors three times in a bid to control costs and plans to make 300 office-based workers redundant in the coming months.

Heavy job cuts, tougher working hours and lower pay have put Wood Group on a collision course with trade unions.

Under the tougher offshore work rotas the number of people manning a platform has contracted by 20pc, raising the risk of potentially fatal accidents due to fatigue. RMT union leader Jake Molloy has warned MPs that the “disengaged, demoralised” workforce is living in “a culture of fear”.

But one can imagine that the same could be said for the oil bosses themselves.

Experts predict that the North Sea’s oilfield service industry could be slashed by a third as companies fold as a result of the downturn. Independent explorers which borrowed billions from lenders when there was little sign of a looming price collapse are now saddled with debt which dwarfs the value of the companies themselves.

David Stewart, boss of the Wood Group services arm, argues that “tough decisions” need to be made to allow the sector to survive. From the company’s Aberdeen offices, he says:

“What we’re trying to do is maintain our steady workforce and also protect jobs in the future. If we keep paying inflated salaries and keep the market hot, costs begin to rise and it’s no good for the industry.

“When the market was really hot, around 30pc of our entire workforce was working on terms and conditions which were significantly above [industry standards]. In the downturn we can’t do that anymore. Every customer is looking for savings.”

The need for leaner operations in the ‘super-mature’ North Sea was becoming clear even before the market crash but in hindsight operator spending habits in a $100 a barrel world seem as extravagant as those of credit-fueled contractors.

In the boom years the relentless pursuit of higher production levels left the market oversupplied and primed for a crash. It also left oil producers bloated with unnecessary costs, inefficient practises and rising debt.

The message for the North Sea is clear: learn to cut the fat and operate as leaner enterprises regardless of the oil price.

Faroe Petroleum is one independent explorer which has avoided the debt trap, and says it can already see greenshoots emerging.

“People have the impression that the North Sea is on its last legs – ‘It’s so old and decrepit and expensive. It’s just a matter of time before they turn the lights out’. That’s not the case,” says Faroe boss Graham Stewart.

“There’s a lot of life left in the North Sea, some of it will be decommissioned but I think there are some green shoots coming out of the downturn. I would not give up on the North Sea,” he adds.

Bob Ruddiman, a lawyer in Pinsent and Masons Aberdeen office, says the North Sea crisis could prove to be the extra push needed to change the sector for the better.

“I don’t think there’s a feeling of doom and gloom. But I think there is a slightly more reflective mindset. It is not sustainable to have a culture where everything is about ‘if you pay more for something you’ll get it’. There has got to be balance,” he says

“The industrial historian might look back at this and see that this has been a difficult period for those who have lived through but it may have a good outcome in the end.”