The number of oil rigs in the US dropped by five for the week ended Friday, as reported by data compiled by energy services company Baker Hughes. The tally for oil decreased to 479 from 484 on a weekly basis, while gas added three rigs to 102. Miscellaneous rigs remained unchanged at four. A year earlier, the US had 497 oil, 118 gas, and four miscellaneous rigs in operation, according to company data.
Overall, 585 rigs were operating in the US this week, down from 619 a year earlier. Among the US states, top producer Texas added two rigs, increasing its total to 279, while New Mexico saw a decrease of three rigs. Across North America, oil and gas rigs increased by three on a weekly basis, reaching a total of 808, compared with 799 at the same point last year.
The count in Canada rose by five to 223 rigs, largely fueled by gains in the oil sector. In market movements, West Texas Intermediate crude oil prices rose 1.1% to $74.53 a barrel in late afternoon trade on Friday, while Brent crude climbed 0.6% to $78.09 a barrel. Both benchmarks were on track for weekly gains.
Compounding these developments, Iran recently carried out a missile attack on Israel in retaliation for the latter's killing of Hezbollah chief Hassan Nasrallah and an Iranian commander in Lebanon. When questioned by reporters about whether the US would support Israel in striking Iranian oil facilities, President Joe Biden stated on Thursday, 'we're in discussion of that.' ING analysts cautioned that depending on the scale of such a response, it could have significant implications for oil markets, not only due to the immediate loss of Iranian oil barrels but also due to the risk of escalation that could disrupt the flow of oil and liquefied natural gas through the Strait of Hormuz..