From Staff Reports
The number of U.S. rigs drilling for oil and natural gas fell again in the past week, bringing the combined count to its lowest level since early 2018. The number of oil rigs was down six while gas-directed rigs fell by two.
In its weekly report Friday, Baker Hughes said the week ended with 764 rigs drilling primarily for oil and 169 seeking gas. A year ago, 869 oil rigs were at work, and 186 gas rigs.
The number of working oil rigs now has fallen for six weeks straight, the longest stretch of declines since March.
The oil rig count, an early indicator of future output, has declined over the past eight months as independent exploration and production companies cut spending on new drilling to focus more on earnings growth instead of increased output.
The latest declines were reported as the International Energy Agency said Friday the U.S.-China trade war and a decline in world economic growth are weakening demand for oil. The Paris-based agency, which advises many developed countries on energy policies, cut its forecast for oil demand growth this year to 1.1 million barrels a day and next year to 1.3 million barrels a day.
By state, Alaska saw the week’s biggest decline, losing four rigs to leave eight at work. Louisiana lost two, to 59, and Oklahoma lost two, to 86. Texas lost one, leaving 454 at work.
By major basin, drillers shut down three rigs in Oklahoma’s Cana Woodford, leaving 45 there. The East Texas-Louisiana Haynesville Shale lost a pair, to 50.
Not all major plays saw declines. The West Texas-New Mexico Permian Basin gained a pair, to 444. The Panhandle’s Granite Wash also added two rigs, to four.
U.S. benchmark crude increased nearly $2 per barrel Friday, supported by a drop in European inventories and OPEC output cuts, and despite the International Energy Agency report.
U.S. oil rose $1.96, or 3.7 percent, to close at $54.50 per barrel in New York.
Brent crude, the international benchmark gained $1.15, or 2%, to settle at $58.53 a barrel in London.