US: Baker Hughes Rig Count

Highlights

Baker Hughes reports the North American rig count down by 10 to 680 from 690 in the previous week. The rig count is down 41 in the latest week from a year ago when it was at 721.

The U.S. rig count is down 3 from last week at 545 and down 38 rigs from 583 last year at this time. The Canadian count is down 7 from last week at 135 and compared to last year is down 3 from 138 a year ago. The Gulf of Mexico count is up 3 from a week ago at 13 and up 2 from 11 in the year-ago week.

For the U.S. count, rigs classified as drilling for oil are flat at 411, gas rigs are down 3 at 127 and miscellaneous rigs are flat at 7. For the Canadian count, oil rigs are down 5 at 83, gas rigs are down 2 at 52, and miscellaneous is flat at 0.

Definition

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.

Description

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).

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