The number of active oil and gas rigs in the United States rose this week by 5 rigs.
The total oil and gas rig count in the United States now stands at 940 rigs, up 418 rigs from the year prior, with the number of oil rigs in the United States increasing by 6 this week and the number of natural gas rigs decreasing by 1. The oil rig count now stands 325 above the count one year ago.
While there is typically a significant lag for correlation between oil prices and rig count movement, the recent rise in oil prices will no doubt encourage US shale drillers to turn on the taps at the more profitable pricing. It’s possible that the response to the prices may be quicker than normal, as the number of drilled-but-uncompleted wells (DUCs) have grown over the past couple of months, and stood at 7,048 as of the last count in August 2017. To compare, in December 2016, the number of DUCs stood at 5,379. A year ago August, the figure was 5,031. The increase in uncompleted wells has risen, year over year, more than 30%.
WTI climbed $1.00 week on week, and almost $9 more than end-June prices. The spot price for WTI fell earlier on Friday as traders hung back before the data release, down 0.21% to $51.45 at 12:33pm EST—still almost $1 over last week’s price. Brent crude was trading down 0.68% on the day at $56.77— $.20 above last week. Related: Traders Are Betting On $100 Oil In 2018
Oil rigs in the United States now number 750—325 rigs above this time last year. Although the number of oil rigs are still up significantly year on year, the increases slowed in the Q2 2017, and have reversed in Q3. The first quarter 2017 saw 137 oil rigs added in the United States, while the second quarter 2017 saw 97 rigs added. In stark contrast, the third quarter, that ended with today’s data, has seen the total number of rigs decrease by 6.
Still, US crude oil production is again on the rise after a brief dip due to Harvey—now at 9.547 million barrels per day for the week ending September 22, 2017—a new high for 2017.
At 10 minutes after the hour, WTI had rallied and was trading at $51.67. Brent crude traded at $56.86.
By Julianne Geiger for Oilprice.com
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