U.S. energy firms this week cut the number of oil and natural gas rigs operating for a third week in a row, energy services firm Baker Hughes said on Oct. 4 in its closely followed report.
The oil and gas rig count, an early indicator of future output, fell by two to 585 in the week to Oct. 4.
Baker Hughes said that puts the total rig count down 34 rigs, or 5.5%, below this time last year.
Baker Hughes said oil rigs fell by five to 479 this week, their lowest since July 19, while gas rigs rose by 3 to 102, their highest since July 19.
The oil and gas rig count dropped about 20% in 2023 after rising by 33% in 2022 and 67% in 2021. The count is down this year due to a decline in oil and gas prices, higher labor and equipment costs from soaring inflation and as companies focused on paying down debt and boosting shareholder returns instead of raising output.
U.S. oil futures were up about 4.9% so far in 2024 after dropping by 11% in 2023, while U.S. gas futures were up about 13.2% so far in 2024 after plunging by 44% in 2023.
Those higher oil prices prompted drillers to boost U.S. crude output from a record 12.9 MMbbl/d in 2023 to 13.3 MMbbl/d in 2024 and 13.7 MMbbl/d in 2025, according to the latest U.S. Energy Information Administration (EIA) outlook.
On the gas side, several producers reduced spending on drilling activities earlier in the year after average spot prices at the U.S. Henry Hub benchmark in Louisiana plunged to a 32-year low in March.
That drilling decline should cause U.S. gas output to slide to 103.4 Bcf/d in 2024, down from a record high of 103.8 Bcf/d in 2023, according to the EIA.
Recommended Reading
Not Sweating DeepSeek: Exxon, Chevron Plow Ahead on Data Center Power
2025-02-02 - The launch of the energy-efficient DeepSeek chatbot roiled tech and power markets in late January. But supermajors Exxon Mobil and Chevron continue to field intense demand for data-center power supply, driven by AI technology customers.
Oil, Gas and M&A: Banks ‘Hungry’ to Put Capital to Work
2025-01-29 - U.S. energy bankers see capital, generalist investors and even an appetite for IPOs returning to the upstream space.
Riverstone’s Leuschen Plans to IPO Methane-Mitigation-Focused SPAC
2025-01-21 - The SPAC will be Riverstone Holdings co-founder David Leuschen’s eighth, following the Permian Basin’s Centennial Resources, the Anadarko’s Alta Mesa Holdings and the Montney’s Hammerhead Resources.
Utica Oil Player Ascent Resources ‘Considering’ an IPO
2025-03-07 - The 12-year-old privately held E&P Ascent Resources produced 2.2 Bcfe/d in the fourth quarter, including 14% liquids from the liquids-rich eastern Ohio Utica.
The Private Equity Puzzle: Rebuilding Portfolios After M&A Craze
2025-01-28 - In the Haynesville, Delaware and Utica, Post Oak Energy Capital is supporting companies determined to make a profitable footprint.
Comments
Add new comment
This conversation is moderated according to Hart Energy community rules. Please read the rules before joining the discussion. If you’re experiencing any technical problems, please contact our customer care team.