Baker Hughes reports that US drillers have cut their oil and gas rigs in the US for eight weeks running.
Baker Hughes, a leading energy services company, said that the U.S. firms have cut back on the number of natural gas and oil rigs for the eighth consecutive week for the first since September 2023.
The number of oil and gas drilling rigs, a good indicator of future production, dropped by one in the week ending June 20 to 554. This is the lowest it has been since November 2020.
Baker Hughes reported that the number of rigs is down by 34, or 5.8% from this time last year.
Baker Hughes reported that oil rigs dropped by one this week to 438, the lowest level since October 2021. Gas rigs also fell by two, to 111, the lowest level since May 30.
Oil and gas rig counts are expected to decline by 5% and 20% respectively in 2024, as the lower U.S. gas and oil prices in recent years have prompted energy companies to concentrate more on increasing shareholder returns and paying off debt than on increasing production.
The U.S. Energy Information Administration, however, projected that crude production would increase from a record 13,2 million barrels a day (bpd), in 2024, to approximately 13.4 million in 2025.
The EIA predicted an 84% rise in the price of spot gas
The EIA predicted that gas production would increase to 105.9 bcfd by 2025. This is up from 103.2 billion cubic feet (bcfd), which was a record in 2024, and 103.6 bcfd for 2023. (Reporting and editing by Scott DiSavino, Anjana Anil)
(source: Reuters)
