In its weekly release, Baker Hughes, a GE company BHGE reported a decline in weekly rig count in the United States.
More on the Rig Count
Baker Hughes’ data, issued at the end of every week since 1944, helps energy service providers gauge the overall business environment of the oil and gas industry.
A change in the Houston-based oilfield services player’s rotary rig count affects demand for energy services like drilling, completion and production provided by the likes of Halliburton Company HAL, Schlumberger Limited SLB, Diamond Offshore Drilling, Inc DO and Transocean Ltd. RIG.
Details
Total US Rig Count Drops: Rigs engaged in the exploration and production of oil and natural gas in the United States totaled 969 in the week ended June 14, down from the prior-week tally of 975. With this, the tally has dropped in nine of the past 10 weeks. The current national rig count is also lower than the prior year’s 1059.
The number of onshore rigs, through the week ended Jun 14, totaled 941, lower than the previous week’s count of 948. However, four rigs operated in inland waters, in line with the prior-week tally. Moreover, the count of offshore rigs was 24, higher than the prior week’s tally by one rig.
US Removes One Oil Rig: Oil rig tally was 788, down from 789 in the week ended Jun 7. With this, the tally for crude-drilling rig declined for two successive weeks.
Moreover, the current total, far from the peak of 1,609 attained in October 2014, is lower than 863 a year ago.
Natural Gas Rig Count Decreases in US: The natural gas rig count of 181 is lower than the count of 186 for the week ended Jun 7.
Moreover, the count of rigs exploring the commodity is lower than the prior-year weeks’ tally of 194. Per the latest report, the number of natural gas-directed rigs is 88.7% below the all-time high of 1,606 recorded in 2008.
Rig Count by Type: The number of vertical drilling rigs totaled 49 units against the previous week’s 46. Notably, the horizontal/directional rig count (encompassing new drilling technology with the ability to drill and extract gas from dense rock formations also known as shale formations) of 920 was lower than the prior-week tally of 929.
Gulf of Mexico (GoM) Rig Count Increases: The GoM rig count is 24 units, of which 22 were oil-directed. The count was higher than the prior-week tally of 23.
Conclusion
Five oil drilling rigs were removed from the Permian basin. This primarily led to a decrease in total rig count operating in the United States. Notably, Permian — the most prolific basin in the United States which employs roughly half of the nation’s total rigs — has seen a decline in oil rigs in eight of the past nine weeks.
This reflects conservative capital spending by domestic explorers and producers following the plummeting oil price.