Rig count drops by two
The U.S. rig count fell by two in the last week according to Enverus Rig Analytics and the count is up 7% in the last month but still down 43% (year-over-year).
In the 12 months, two gas-focused regions have seen an increase in drilling— the Ark-La-Tex count is up by three and in the northeast, two rigs have been added in the last year. The rest of the major U.S. oil and gas regions lost anywhere from 43-62% of their rigs, with the Rockies declining 62% as of March 10.
Major operators, such as Exxon Mobil, is running 57 fewer rigs (year-over-year), ConocoPhillips is down by 21 rigs at 14, and Chevron is down by 19, to nine. Other multi-basin drillers with double-digit declines were Continental Resources, Devon Energy and EOG Resources.
U.S. crude futures soared to almost $68 per barrel this week, their highest since 2018. Prices rebounded from last year’s crash, spurred by the effects of the coronavirus pandemic.
This week, the government revised down 2021’s decline expected in crude production. Output is seen falling 160,000 barrels per day in 2021 to 11.15 million barrels per day.
Before the pandemic, companies were cutting rigs about four rigs on a weekly basis over the prior year to focus on boosting cash flow, reducing debt and increasing shareholder returns.
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