US: Baker Hughes Rig Count

Highlights

Baker Hughes reports the North American rig count up by 21 to 696 from 675 in the previous week. The rig count is up 16 in the latest week from a year ago when it was at 680.

The U.S. rig count is up 7 from last week at 558 and down 8 rigs from 566 last year at this time. The Canadian count is up 14 from last week at 138 and compared to last year is up 24 from 114 a year ago. The Gulf of Mexico count is up 2 from a week ago at 10 and up 1 from 9 in the year-ago week.

For the U.S. count, rigs classified as drilling for oil are up 10 at 425, gas rigs are down 3 at 125 and miscellaneous rigs are flat at 8. For the Canadian count, oil rigs are up 11 at 87, gas rigs are flat at 48, and miscellaneous is up 3 at 3.

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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