The number of oil rigs in the US increased by five between Nov. 27 and Dec. 6, reflecting the latest figures compiled by energy services company Baker Hughes ($BKR). The oil rig count rose to 482 as of Friday from 477 on Nov. 27. Additionally, gas rigs saw a gain of two, bringing the total to 102, while the number of miscellaneous rigs maintained a steady count at five.
This comparison highlights a significant decline from the previous year, as the US had 503 oil rigs, 119 gas rigs, and four miscellaneous rigs in operation at the same time last year. In total, as of Friday, 589 rigs were active in the US, a noticeable decrease from 626 a year prior. Within the states, the leading oil producer, Texas, contributed five new rigs, increasing its count to 286 from the earlier figure on Nov.
27, while neighboring states such as Ohio and Oklahoma each lost one rig during the same period. On a broader scale, oil and gas rigs across North America decreased by four to a combined total of 783 since Nov. 27, with Canada experiencing a decline of 11 rigs, primarily attributed to oil operations.
In the market, West Texas Intermediate crude oil traded down 1.7% at $67.19 a barrel by Friday afternoon, while Brent crude fell by 1.4% to settle at $71.08 per barrel. Both benchmarks were positioned for consecutive weekly declines. On Thursday, key members of the Organization of the Petroleum Exporting Countries (OPEC) and associated allies made the decision to extend oil production cuts to bolster 'market stability.' Despite these efforts, market expectations indicate a likely surplus in the first half of the upcoming year, albeit at a more manageable rate of approximately 500,000 barrels per day, a substantial adjustment from the previous forecast of 1 million barrels, as reported by ING Bank on Friday.
Warren Patterson, the Head of Commodities Strategy at ING, remarked on the situation: 'While the action taken by OPEC+ may potentially provide a higher floor to the market than previously expected, ultimately the group will still have to accept lower prices.' He highlighted ongoing challenges, including increasing non-OPEC supply and the lackluster growth in demand, particularly owing to conditions in China..