Rig count increases remain steady

Another week of steady increases was reported for the past week’s U.S. rig count.

According to Enverus Rig Analytics, the count is up 9% in the last month, but down 51% year-over-year, with no significant changes in major basins on the week. Of note, however, is that Wyoming had one operating rig last week and added four new rigs for a total of five rigs. Pennsylvania also added two rigs.

Most major basins have experienced a recovery in drilling activity since the start of the second quarter led by the Permian Basin. The U.S. Gulf Coast, which includes the Eagle Ford Shale, increase has nearly doubled for the same quarterly period. Meanwhile, the Appalachian and Williston basins have lagged behind these gains.

U.S. energy firms this week added the most oil and natural gas rigs in a week since January 2020 as producers keep returning to the wellpad with crude prices trading around $45/bbl since late November. U.S. oil rigs rose 12 the past week and gas rigs rose the most in a week since April 2019. Both oil and gas rigs hit their highest count since May.

The August count, according to Baker Hughes records, was the lowest number of operating rigs since hitting a low going back to 1940.

U.S. crude oil production has recovered from the nearly three-year lows touched in May, but is still expected to decline by 910,000 bbl/d this year to 11.34 million bbl/d, the government forecast this week.

WTI, the U.S. crude benchmark, has risen about 148% over the past eight months on hopes that an effective coronavirus vaccine will revive global economies and energy demand. On Dec. 11, it was trading below $47/bbl, which is still down about 23% since the start of the year.

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