In a recent report, the number of oil rigs operating in the United States experienced a slight decrease, dropping from 479 to 478. This week saw a loss of one gas rig, bringing the total down to 101, while the miscellaneous rigs count edged up by one to five. A year ago, the US was operating 500 oil rigs, 114 gas rigs, and four miscellaneous rigs, illustrating a notable decline this year. Currently, there are 584 total rigs in operation across the US, a decrease from 618 a year ago.
Texas, the leading oil-producing state, saw a reduction of two rigs, leaving the total at 279. Oklahoma and Utah each lost one rig, while New Mexico added two, positively impacting its rig count. On a broader scale, North America witnessed a decline in oil and gas rigs, with the total down eight to 784.
Canada's rig count specifically fell by seven, landing at 200 rigs for the week. Market responses reflected these changes, with West Texas Intermediate crude oil prices down 2.4% at $67.04 per barrel during late-afternoon trading on Friday. Similarly, Brent crude dropped 2% to $71.11 per barrel. Analysts are signaling concerns over diminishing demand in China, contributing to the downward trajectory in prices. Earlier this week, the International Energy Agency (IEA) raised its global oil demand forecast for 2024.
However, it also noted that consumption in China has been decreasing for six consecutive months as of September. Concurrently, the Organization of the Petroleum Exporting Countries (OPEC) lowered its oil demand projections for 2024 and 2025 for the fourth consecutive month. Adding to the economic narrative, the Energy Information Administration released data showing an unexpected increase in commercial crude stockpiles in the US last week, reflecting potential oversupply issues in the market..