Baker Hughes reports that the US oil and gas rig counts have fallen to their lowest level since January.
Baker Hughes, a leading energy services company, said that the U.S. oil and gas companies have reduced their number of operating oil and natural-gas rigs to its lowest level since January.
The number of oil and gas rigs, a good indicator of future production, dropped by six in the week ending May 9 to 578.
Baker Hughes reported that the total number of rigs is down 25 or 4% from this time last week.
Baker Hughes reported that oil rigs dropped by five this week to 474, the lowest level since January. Gas rigs remained unchanged at 101.
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 increasing production.
The U.S. Energy Information Administration, which is based in the United States, forecast crude production would increase from a record 13,2 million barrels of oil per day in 2024 to approximately 13.4 million barrels in 2025.
The EIA had forecast a higher increase in production in April, but it was less than that due to lower oil prices as U.S. Tariffs are increasing the likelihood of a weaker global economy and oil demand.
The EIA predicted an 88% rise in the price of spot gas
The EIA predicted that gas production would increase to 104.9 billion cubic feet per day in 2025. This is up from 103.2 billion cubic foot per day in 2024, and a record high of 103.6 bcfd for 2023.
Texas, which is the leading oil producing state in the United States, has seen a spike in applications for drilling permits.
four-year low
In April, there were concerns about rising temperatures
Enverus, a consultancy, said that the supply of crude oil and a trade conflict will continue to affect prices.
Enverus reports that operators in Texas filed 570 new drilling permits in April, down from the 795 applications submitted in March, and the lowest number of applications since February 2021.
Shale producer
Diamondback
On Monday, it announced that it would reduce its rig count by three in the second quarter. It could also further reduce their activity if oil prices continue to fall. Rival
Coterra Energy
Producers are reducing their Permian activity in 2025 by three rigs.
Matador Resources
By 2025, the drilling rigs will be reduced to one. (Reporting and Editing by Marguerita Chy)
(source: Reuters)
