U.S. Oil and Gas Rig Count Falls to 587 as Crude Prices Decline Friday
Key Takeaways
- •The total U.S. oil and gas rig count fell to 587, remaining 45 rigs higher than the same period last year.
- •U.S. crude oil production averaged 13.798 million barrels per day in the week ending July 17, down slightly from the prior week but up 525,000 bpd year-over-year.
- •Primary Vision's Frac Spread Count declined by 4 to 196 crews, following a 5-crew drop the previous week.
- •The Permian Basin rig count decreased by 1 to 258, which is 2 rigs below the year-ago level.
- •Brent crude fell 4.70% to $95.96 per barrel on Friday while WTI dropped 4.22% to $88.30, though Brent remained more than $8 higher than the previous week.
The total number of active oil and gas drilling rigs in the United States declined this week, according to data published Friday by Baker Hughes, bringing the nationwide rig count to 587. The total remains 45 rigs higher than at the same time last year. The rig count is widely watched as an early indicator of future domestic supply, as drilling activity today typically translates into production in subsequent months.
Active oil rigs fell by 2 during the latest reporting period to 450, according to the data. That figure is 35 above the year-ago level. The number of gas rigs rose by 1 to 127, which is 5 more than at the same point last year. Miscellaneous rigs were unchanged at 10.
The latest EIA data showed that weekly U.S. crude oil production edged lower in the week ending July 17. U.S. crude production averaged 13.798 million barrels per day during the reporting period, down from 13.861 million barrels per day the previous week. Output was still up by 525,000 barrels per day from a year earlier. The United States remains the world's largest crude oil producer, meaning even small week-to-week shifts in domestic output are closely tracked by global energy markets.
Primary Vision's Frac Spread Count, an estimate of the number of crews completing wells, also declined. The count fell by 4 in the week ending July 17 to 196 crews, after dropping by 5 in the prior week. Because fracing crews bring already-drilled wells into production, the frac spread count is often viewed as a nearer-term signal of supply readiness than the rig count alone.
In key shale regions, the number of active drilling rigs in the Permian Basin fell by 1 during the reporting period to 258. That total is 2 rigs below the level reported a year ago. The Permian, spanning West Texas and southeastern New Mexico, accounts for more than 40% of total U.S. rig activity and is the country's highest-producing oil basin. In the Eagle Ford, the rig count was unchanged again this week at 47, which is 8 higher than at the same time last year.
Oil prices were lower on Friday. Brent was trading at $95.96 per barrel, down 4.70% on the day. Despite the daily decline, Brent remained more than $8 per barrel higher than at the same time last week. WTI was also trading lower on the day at $88.30 per barrel, down 4.22%.
By Julianne Geiger for Oilprice.com.