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The Zacks Analyst Blog Highlights: Halliburton Co, Schlumberger, Transocean, Devon Energy and Diamondback Energy

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For Immediate Release

Chicago, IL – March 31, 2021 – 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: Halliburton Company (HAL - Free Report) , Schlumberger Limited (SLB - Free Report) , Transocean Ltd. (RIG - Free Report) , Devon Energy Corporation (DVN - Free Report) and Diamondback Energy, Inc. (FANG - Free Report) .

Here are highlights from Tuesday’s Analyst Blog:

Permian Witnesses Addition of Oil Rigs for 5 Straight Weeks

In its weekly release, Baker Hughes reported an increase in the U.S. rig count.

More on the Rig Count

Baker Hughes' data, which has been 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 this Houston-based oilfield service player's rotary rig count affects demand for energy services like drilling, completion and production, provided by the likes of Halliburton Co.Schlumberger and Transocean.

Details

Total US Rig Count Increases: The count of rigs engaged in the exploration and production of oil and natural gas in the United States was 417 for the week through March 26 compared with the prior-week figure of 411. Importantly, since last April, the latest weekly oil & gas rig tally has been the highest. However, the current national rig count is below the year-ago level of 728.

The number of onshore rigs for the week ended Mar 26 totaled 405, higher than the prior count of 398. However, in offshore resources, 12 rigs were operating, lower than the prior week's count of 13.

US Adds 6 Oil Rigs: Oil rig count was 324 for the week through Mar 26 compared with 318 in the week ended Mar 19. Investors should also note that the current tally of oil rigs — far from the peak of 1,609 attained in October 2014 — is, however, below the year-ago figure of 624.

Natural Gas Rig Count Flat in US: Natural gas rig count of 92 was in line with the prior-week count. Notably, the count of rigs exploring the commodity was below the prior-year week's 102. Per the latest report, the number of natural gas-directed rigs is almost 94.3% below the all-time high of 1,606 recorded in 2008.

Rig Count by Type: The number of vertical drilling rigs totaled 22 units, lower than the prior week's 25 units. However, 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 395 compared favorably with the prior-week level of 386.

Gulf of Mexico (GoM) Rig Count Declines: GoM rig count was 12 units, all of which were oil-directed. The count was lower than the prior-week tally of 13.

Rig Count in Prolific Basin

Permian — the most prolific basin in the United States — recorded a weekly oil rig tally of 221 compared with the prior-week count of 216. Thus, the tally for oil drilling rigs in the basin increased for five weeks in a row.

Outlook

The price of West Texas Intermediate crude, trading at more than $61 per barrel, rebounded from the pandemic lows when oil was in the negative territory. The crude price rally is likely to continue since the domestic economy will possibly bounce back strongly later this year as coronavirus vaccines are being rolled out at a massive scale.

Thus, with more people commuting to offices and traveling will ultimately aid fuel demand. Therefore, oil and gas drillers are likely to add rigs steadily to shale plays since the pricing environment will continue to be favorable.

Meanwhile, investors may keep an eye on two energy stocks, namely Devon Energy and Diamondback Energy, which are expected to benefit provided the oil price remains healthy. Both stocks currently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

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