US: Baker-Hughes Rig Count

Fri Oct 20 12:00:00 CDT 2017

Actual Previous
N. Amer. Rig Count 1115 1140
U.S. 913 928
Gulf of Mexico 20 20
Canada 202 212

The Baker Hughes North American rig count is down 25 rigs in the October 20 week to 1,115. The U.S. rig count is down 15 rigs at 913 but is up 360 rigs from last year at this time. The Canadian count is down 10 rigs from last week at 202 but compared to last year is up 59 rigs.

For the U.S. count, rigs classified as drilling for oil are down 7 rigs at 736 while gas rigs are down 8 at 177. For the Canadian count, oil rigs are down 5 at 107 and gas rigs are also down 5, at 95 rigs.

The week's large drop is the fourth consecutive weekly decline in the count, and is partly caused by seasonality as cold weather begins to curtail operations in northern regions, and partly probably by lingering hurricane damages, with Texas down 8 rigs to 436.

The Baker Hughes North American rig count tracks weekly changes in the number of active operating oil & gas rigs. Used for drilling wellbores for wells that may eventually produce oil or gas, active rigs are essential for the exploration and development of oil and gas fields. Rigs that are not active are not counted. Components in the data are the United States and Canada with a separate count for the Gulf of Mexico (which is a subset of the U.S. total). The count includes only rigs that are significant users of oilfield services and supplies.

Changes in rig counts point to changes in the supply of oil & gas. The higher the rig count, the greater the upward pressure is on oil & gas supply and in turn the greater the downward pressure is on oil & gas prices. The reverse applies when rig counts turn lower, as they did during the oil price collapse of 2014-15 when lower counts contributed to a subsequent decline in domestic oil inventories. Data on the Gulf of Mexico offer indications on production disruptions during the hurricane season (June 1st to November 30th).