Baker Hughes reports that the US oil/gas rig counts fell for a fourth month, to a low of Oct 2021.
Baker Hughes, a leading energy services company, said that the U.S. has cut its number of operating oil and gas rigs for the fourth consecutive month to the lowest level since October 2021.
The number of oil and gas drilling rigs, a good indicator of future production, dropped by seven in the week ending June 27.
Baker Hughes reported that the number of rigs is down by 34 this week, or about 6% from this time last year.
Baker Hughes reported that oil rigs dropped by six this week to 432, their lowest level since October 2021. Gas rigs also decreased by two, to 109.
Drillers in the Permian basin, located in West Texas and Eastern New Mexico, have cut one drilling rig, bringing their total to 270. This is the lowest level since October 2021.
Drillers have also reduced five rigs this week in Wyoming, bringing the number to 18, which is the lowest level since January. This five-rig drop was the largest in a single week since 2020.
Drillers cut 16 oil-and-gas rigs in June, bringing the total down for the fourth consecutive month for the first since June 2024.
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 independent exploration companies (E&Ps) tracked by U.S. Financial Services firm TD Cowen have said that they plan to reduce capital expenditures in 2025 by approximately 3% from the levels in 2024.
This compares to spending that is roughly flat in 2024 and increases of 27%, 40%, and 44% in 2023.
The U.S. Energy Information Administration, however, projected that crude production would increase from a record 13,2 million barrels per daily (bpd), in 2024, to around 13,4 million bpd by 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 Margueritachoy and Diane Craft; Reporting by Scott DiSavino)
(source: Reuters)
