For Immediate Release
Chicago, IL – June 6, 2012– Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Baker Hughes Inc. (
BHI
- Analyst Report
)
, Diamond Offshore (
DO
- Analyst Report
)
, Nabors Industries (
NBR
- Analyst Report
)
, Patterson-UTI Energy (
PTEN
- Analyst Report
)
and Helmerich & Payne (
HP
- Analyst Report
)
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513
Here are highlights from Tuesday’s Analyst Blog:
Nat Gas Rig Count Lowest Since 1999
In its weekly release, Houston-based oilfield services company Baker Hughes Inc. (
BHI
- Analyst Report
)
reported a dip in the U.S. rig count (number of rigs searching for oil and gas in the country).
This can be attributed to cutbacks in the tally of gas-directed rigs, partially offset by increase in oil rig count. In particular, the natural gas rig count dropped for the eighteenth time in 21 weeks to touch a near 13-year low, while oil drilling jumped to another 25-year high.
The Baker Hughes rig count, issued since 1944, acts as an important yardstick for drilling contractors such as Diamond Offshore (
DO
- Analyst Report
)
, Nabors Industries (
NBR
- Analyst Report
)
, Patterson-UTI Energy (
PTEN
- Analyst Report
)
, Helmerich & Payne (
HP
- Analyst Report
)
, etc. in gauging the overall business environment of the oil and gas industry.
Analysis of the Data
Weekly Summary: Rigs engaged in exploration and production in the U.S. totaled 1,980 for the week ended June 1, 2012. This was down by 3 from the previous week’s count and represents the second decrease in as many weeks.
Despite this, the current nationwide rig count is more than double that of the 6-year low of 876 (in the week ended June 12, 2009) and significantly exceeds the prior-year level of 1,854. It rose to a 22-year high in 2008, peaking at 2,031 in the weeks ending August 29 and September 12.
Rigs engaged in land operations descended by 2 to 1,911, while inland waters activity was down by 1 to 21 rigs. Meanwhile, offshore drilling remained steady at 48 units.
Natural Gas Rig Count: The natural gas rig count decreased for the eighteenth time in 21 weeks to 588 (a drop of 6 rigs from the previous week). As per the most recent report, the number of gas-directed rigs is at their lowest level since October 15, 1999 and is down more than 37% from its 2011 peak of 936, reached during mid-October.
The current natural gas rig count remains 63% below its all-time high of 1,606 reached in late summer 2008. In the year-ago period, there were 887 active natural gas rigs.
Oil Rig Count: The oil rig count was up by 3 to 1,386. The current tally – the highest since Baker Hughes started breaking up oil and natural gas rig counts in 1987 – is way above the previous year’s rig count of 959. It has recovered strongly from a low of 179 in June 2009, rising more than 7.7 times.
Miscellaneous Rig Count: The miscellaneous rig count (primarily drilling for geothermal energy) at 6 remained unchanged from the previous week.
Rig Count by Type: The number of vertical drilling rigs rose by 10 to 580, while the horizontal/directional rig count (encompassing new drilling technology that has the ability to drill and extract gas from dense rock formations, also known as shale formations) was down by 13 at 1,400. In particular, horizontal rig units – that reached an all-time high of 1,193 in May this year – decreased by 8 from last week’s level to 1,183
To Conclude
As mentioned above, the natural gas rig count has been falling since the last few weeks, 346 rigs in fact (or 37%) from the recent highs of 934 in October 28.
Is this bullish for natural gas fundamentals? The answer is "no," if we look at the U.S. production and the shift in rig composition.
With horizontal rig count – the technology responsible for the abundant gas drilling in domestic shale basins – currently close to its all-time high, output from these fields remains robust. As a result, gas inventories remain at elevated levels – up some 35% above the benchmark five-year average levels.
Hamstrung by this huge surplus, natural gas prices have dropped more than 51% from 2011 peak of $4.92 per million Btu (MMBtu) in June to the current level of around $2.40 (referring to spot prices at the Henry Hub, the benchmark supply point in Louisiana). Incidentally, prices hit a 10-year low of $1.82 during late April.
To make matters worse, a near-record mild weather across most of the country curbed natural gas demand for heating, leading to an early beginning for the stock-building season. The grossly oversupplied market continues to pressure commodity prices in the backdrop of sustained strong production.
Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
Media Contact
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800-767-3771 ext. 9339
support@zacks.com
http://www.zacks.com
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For Immediate Release
Chicago, IL – June 6, 2012– Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Baker Hughes Inc. ( BHI - Analyst Report ) , Diamond Offshore ( DO - Analyst Report ) , Nabors Industries ( NBR - Analyst Report ) , Patterson-UTI Energy ( PTEN - Analyst Report ) and Helmerich & Payne ( HP - Analyst Report )
Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513
Here are highlights from Tuesday’s Analyst Blog:
Nat Gas Rig Count Lowest Since 1999
In its weekly release, Houston-based oilfield services company Baker Hughes Inc. ( BHI - Analyst Report ) reported a dip in the U.S. rig count (number of rigs searching for oil and gas in the country).
This can be attributed to cutbacks in the tally of gas-directed rigs, partially offset by increase in oil rig count. In particular, the natural gas rig count dropped for the eighteenth time in 21 weeks to touch a near 13-year low, while oil drilling jumped to another 25-year high.
The Baker Hughes rig count, issued since 1944, acts as an important yardstick for drilling contractors such as Diamond Offshore ( DO - Analyst Report ) , Nabors Industries ( NBR - Analyst Report ) , Patterson-UTI Energy ( PTEN - Analyst Report ) , Helmerich & Payne ( HP - Analyst Report ) , etc. in gauging the overall business environment of the oil and gas industry.
Analysis of the Data
Weekly Summary: Rigs engaged in exploration and production in the U.S. totaled 1,980 for the week ended June 1, 2012. This was down by 3 from the previous week’s count and represents the second decrease in as many weeks.
Despite this, the current nationwide rig count is more than double that of the 6-year low of 876 (in the week ended June 12, 2009) and significantly exceeds the prior-year level of 1,854. It rose to a 22-year high in 2008, peaking at 2,031 in the weeks ending August 29 and September 12.
Rigs engaged in land operations descended by 2 to 1,911, while inland waters activity was down by 1 to 21 rigs. Meanwhile, offshore drilling remained steady at 48 units.
Natural Gas Rig Count: The natural gas rig count decreased for the eighteenth time in 21 weeks to 588 (a drop of 6 rigs from the previous week). As per the most recent report, the number of gas-directed rigs is at their lowest level since October 15, 1999 and is down more than 37% from its 2011 peak of 936, reached during mid-October.
The current natural gas rig count remains 63% below its all-time high of 1,606 reached in late summer 2008. In the year-ago period, there were 887 active natural gas rigs.
Oil Rig Count: The oil rig count was up by 3 to 1,386. The current tally – the highest since Baker Hughes started breaking up oil and natural gas rig counts in 1987 – is way above the previous year’s rig count of 959. It has recovered strongly from a low of 179 in June 2009, rising more than 7.7 times.
Miscellaneous Rig Count: The miscellaneous rig count (primarily drilling for geothermal energy) at 6 remained unchanged from the previous week.
Rig Count by Type: The number of vertical drilling rigs rose by 10 to 580, while the horizontal/directional rig count (encompassing new drilling technology that has the ability to drill and extract gas from dense rock formations, also known as shale formations) was down by 13 at 1,400. In particular, horizontal rig units – that reached an all-time high of 1,193 in May this year – decreased by 8 from last week’s level to 1,183
To Conclude
As mentioned above, the natural gas rig count has been falling since the last few weeks, 346 rigs in fact (or 37%) from the recent highs of 934 in October 28.
Is this bullish for natural gas fundamentals? The answer is "no," if we look at the U.S. production and the shift in rig composition.
With horizontal rig count – the technology responsible for the abundant gas drilling in domestic shale basins – currently close to its all-time high, output from these fields remains robust. As a result, gas inventories remain at elevated levels – up some 35% above the benchmark five-year average levels.
Hamstrung by this huge surplus, natural gas prices have dropped more than 51% from 2011 peak of $4.92 per million Btu (MMBtu) in June to the current level of around $2.40 (referring to spot prices at the Henry Hub, the benchmark supply point in Louisiana). Incidentally, prices hit a 10-year low of $1.82 during late April.
To make matters worse, a near-record mild weather across most of the country curbed natural gas demand for heating, leading to an early beginning for the stock-building season. The grossly oversupplied market continues to pressure commodity prices in the backdrop of sustained strong production.
Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.
Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
http://www.zacks.com
Read the full reports :
Analyst Report on BHI
Analyst Report on DO
Analyst Report on NBR
Analyst Report on PTEN
Analyst Report on HP