In the week ended January 15, the number of rigs drilling for oil in the United States totaled 515, compared with 516 in the prior week and 1,366 a year ago. Including 135 other rigs drilling for natural gas, there are a total of 650 working rigs in the country, down 14 week over week, and down 1,026 year over year. The data come from the latest Baker Hughes North American Rotary Rig Count released on Friday.

West Texas Intermediate (WTI) crude oil for February delivery traded down about 5.7% on Friday to settle at $29.42, a drop of more than 11% for the week. The U.S. Energy Information Administration (EIA) reported last Wednesday that crude supplies had increased by 200,000 barrels in the week ended January 8, but that gasoline supplies had soared by 8.4 million barrels.

Gasoline stockpiles have risen by 19 million barrels over the past two reporting periods and have added to the pressure on crude oil prices. Refineries are now running at 91.2% of capacity in advance of the turnaround and maintenance season, which normally begins in late February. Refineries typically run at about 85% to 89% of capacity during that time and pump prices typically rise. This time could be different.

The number of rigs drilling for oil in the United States is down by 851 year over year, and down by just one week over week. The natural gas rig count dropped by 13, from 148 to 135. The count for natural gas rigs is down by 175 year over year. Natural gas closed the week at $2.12 per million BTUs, down 14.5% from $2.48 at the end of the prior week.

Gasoline stockpiles increased by 8.4 million barrels in the week of January 15, and U.S. refineries ran at 91.2% of capacity, a week-over-week decrease of about 194,000 barrels a day. Imports rose to 8.2 million barrels a day in the week, a week-over-week gain of 678,000 barrels a day. The increase in imports reflects the need from U.S. refiners for heavier crude oil, mostly from Mexico, to mix with the light U.S. crudes to create a blend that runs best in U.S. refineries.

Hedge funds — under the Managed Money heading in the Commodity Futures Trading Commission (CFTC) weekly Commitments of Traders report — added 30,929 short contracts last week and 17,865 long contracts. The movement reflects changes as of the January 12 settlement date. Managed money holds 249,863 long positions, compared with 213,491 short positions. Open interest totaled 1,756,232. There were 68 hedge funds with large short positions last week, an increase of six compared with the prior week.

Among the producers themselves short positions outnumber longs, 396,035 to 171,050. The number of short positions rose by 20,656 contracts last week and longs rose by 8,420 positions. Positions among swaps dealers show 203,695 shorts versus 250,440 longs. Swaps dealers dropped 6,460 contracts from their short positions last week and added 16,101 long contracts.

Among the states, Texas dropped seven rigs last week, Louisiana dropped five and Colorado, New Mexico and North Dakota lost two each. Ohio and Wyoming each dropped one. Oklahoma added four rigs while California, Kansas and Pennsylvania each added one.

In the Permian Basin of west Texas and southeastern New Mexico, the rig count fell by seven to a total of 202. The Eagle Ford Basin in south Texas lost three rigs, bringing its total to 68, and the Williston Basin (Bakken) in North Dakota and Montana now has 47 working rigs, down two from the prior week.

Enterprise Products Partners lists a posted price of $25.87 per barrel for WTI and a January 16 price of $20.35 a barrel for North Dakota Light Sweet. The posted price for a barrel of Eagle Ford crude is $25.82. The price for all three varieties of crude fell by $3.74 a barrel in the past week.

The pump price of gasoline fell by about 3.3% week over week. Saturday morning’s average price in the United States was $1.911 a gallon, down from $1.977 a week ago.

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