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Slipping Rig Count Can’t Keep Oil Prices From Falling

Slipping Rig Count Can’t Keep Oil Prices From Falling

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Baker Hughes reported a 4-rig decrease for oil and gas in the United States this week—a loss in rigs for the third week in a row. The four-rig decline was all on the oil-rig side, with gas rigs holding steady.

The total number of active oil and gas drilling rigs now stands at 1,071 according to the report, with the number of active oil rigs decreasing by 4 to reach 873 and the number of gas rigs holding steady at 198.

The oil and gas rig count is now 141 up from this time last year, 126 of which is in oil rigs.

Crude oil prices fell sharply near the close of the week on Friday despite production losses in OPEC’s Libya and an agreement within OPEC+ to cut 1.2 million bpd from the expanded cartel’s October production.

The WTI benchmark was trading down 2.26% (-$1.19) at $51.39—a loss of more than $2 per barrel week over week—at 11:39am EST. Brent crude was trading down 1.84% (-$1.13) at $60.32—also down more than $2 per barrel from last week

Canada’s oil and gas rigs for the week decreased by 12 rigs this week after losing 17 rigs last week, bringing its total oil and gas rig count to 174, which is 64 fewer rigs than this time last year, with a 7-rig decrease for oil rigs, and a 5-rig decrease for gas rigs.

The EIA’s estimates for US production for the week ending December 7 continues to weigh on prices, averaging 11.6 million bpd­—a drop off from the previous 11.7 million bpd for the previous four weeks.

By 1:07pm EDT, WTI had decreased by 2.68% (-$1.41) at $51.17 on the day. Brent crude was trading down 2.03% (-$1.25) at $60.20 per barrel.

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