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US Rig Count Up by 7, More Drilling Activity Seen on Land
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In its weekly release, Houston-based oilfield services company Baker Hughes Inc. reported a higher U.S. rig count (number of rigs searching for oil and gas in the country) than the previous week. The West Texas Intermediate (WTI) oil futures are currently trading at around $45 per barrel.
Analysis of the Weekly Rig Data
Weekly Summary: Rigs engaged in exploration and production in the U.S. totaled 447 in the week ended Jul 15, 2016. This was up by seven from the week before.
The current nationwide rig count is less than half the prior-year level of 857. Notably, the count had peaked at 4,530 in 1981. Inversely, an all-time low was recorded in March. Since then the rig count has recovered marginally.
Rigs engaged in land operations were 422 compared with 417 in the previous week. Inland water activity involved three rigs, down by one from the prior week. Offshore drilling rose by three to 22 units.
Natural Gas Rig Count: The count rose by one from last week to 89. However, the current natural gas rig count is almost 95% below the high of 1,606 reached in late summer 2008. In the year-ago period, there were 218 active natural gas rigs.
Oil Rig Count: The count was up by six from the previous week at 357. The number had skyrocketed to 1,609 in Oct 2014 – the highest figure to have been reported since Baker Hughes started breaking up oil and natural gas rig counts in 1987. The current tally is well below the previous year’s rig count of 638.
Rig Count by Type: The number of vertical drilling rigs fell by one to 60, while the horizontal/directional rig count (encompassing new drilling technology that can drill and extract gas from dense rock formations, also known as shale formations) was up by eight to 387.
Gulf of Mexico (GoM): The GoM rig count was up by three to 21 units.
Conclusion
Key Barometer of Drilling Activity: The Baker Hughes data, issued since 1944, acts as an important yardstick for energy service providers in gauging the overall business environment of the oil and gas industry.
An increase or decrease in the Baker Hughes’ rotary rig count weighs heavily on demand for energy services like drilling, completion and production provided by companies that include large-cap firms such as Halliburton Co. (HAL - Free Report) , Schlumberger Ltd. (SLB - Free Report) and Weatherford International plc .
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US Rig Count Up by 7, More Drilling Activity Seen on Land
In its weekly release, Houston-based oilfield services company Baker Hughes Inc. reported a higher U.S. rig count (number of rigs searching for oil and gas in the country) than the previous week. The West Texas Intermediate (WTI) oil futures are currently trading at around $45 per barrel.
Analysis of the Weekly Rig Data
Weekly Summary: Rigs engaged in exploration and production in the U.S. totaled 447 in the week ended Jul 15, 2016. This was up by seven from the week before.
The current nationwide rig count is less than half the prior-year level of 857. Notably, the count had peaked at 4,530 in 1981. Inversely, an all-time low was recorded in March. Since then the rig count has recovered marginally.
Oils-Energy Sector Price Index
Oils-Energy Sector Price Index
Rigs engaged in land operations were 422 compared with 417 in the previous week. Inland water activity involved three rigs, down by one from the prior week. Offshore drilling rose by three to 22 units.
Natural Gas Rig Count: The count rose by one from last week to 89. However, the current natural gas rig count is almost 95% below the high of 1,606 reached in late summer 2008. In the year-ago period, there were 218 active natural gas rigs.
Oil Rig Count: The count was up by six from the previous week at 357. The number had skyrocketed to 1,609 in Oct 2014 – the highest figure to have been reported since Baker Hughes started breaking up oil and natural gas rig counts in 1987. The current tally is well below the previous year’s rig count of 638.
Rig Count by Type: The number of vertical drilling rigs fell by one to 60, while the horizontal/directional rig count (encompassing new drilling technology that can drill and extract gas from dense rock formations, also known as shale formations) was up by eight to 387.
Gulf of Mexico (GoM): The GoM rig count was up by three to 21 units.
Conclusion
Key Barometer of Drilling Activity: The Baker Hughes data, issued since 1944, acts as an important yardstick for energy service providers in gauging the overall business environment of the oil and gas industry.
An increase or decrease in the Baker Hughes’ rotary rig count weighs heavily on demand for energy services like drilling, completion and production provided by companies that include large-cap firms such as Halliburton Co. (HAL - Free Report) , Schlumberger Ltd. (SLB - Free Report) and Weatherford International plc .
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>