Oil Rig Count Drops by 3, Total Rigs Now Up 436 Year Over Year

In the week ended September 8, 2017, the number of rigs drilling for oil in the United States totaled 756, down by three compared with the prior week and up by 342 compared with a total of 414 a year ago. Including 187 other rigs drilling for natural gas and one listed as miscellaneous, there are a total of 944 working rigs in the country, one more week over week and up by 436 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 October delivery settled at $49.09 a barrel, down about 0.1% on Thursday. Crude prices were trading down about 2.1% Friday afternoon at around $48.05 and rose to around $48.10 after the rig count data were released.

The natural gas rig count increased by four to a total of 187 this week. The count for natural gas rigs is now up by 95 year over year. Natural gas for October delivery traded down about 3% at around $2.89 per million BTUs before the count was released and remained essentially flat afterward.

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The oil rig count is down again this week after remaining unchanged last week, but the drop was small. The impact of tropical storm Harvey on Eagle Ford production was limited and transportation from the Permian Basin of west Texas has rebounded as lines to the refineries around Corpus Christi and Houston restart operations. As deadly and damaging as Harvey was, its impact on the energy industry, especially the drilling part of it, appears to have been relatively limited and primarily temporary.

Among the states, Alaska lost two rigs last week while Arkansas, Colorado and Louisiana each lost one. New Mexico added three and North Dakota, Pennsylvania and West Virginia each added one.

In the Permian Basin of west Texas and southeastern New Mexico, the rig count now stands at 382, up by two compared with the previous week’s count. The Eagle Ford Basin in south Texas has 73 rigs in operation, unchanged week over week, and the Williston Basin (Bakken) in North Dakota and Montana now has 53 working rigs, up one for the week.

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