More good news came in today for the oil bulls as Baker Hughes reported a 8-rig decrease for oil and gas in the United States this week.
The total number of active oil and gas drilling rigs now stands at 1,075 according to the report, with the number of active oil rigs decreasing by 8 to reach 877 and the number of gas rigs holding steady at 198.
The oil and gas rig count is now 151 up from this time last year, 135 of which is in oil rigs.
WTI prices were up on Friday following despite a rather bleak EIA report that showed substantial gasoline and distillate inventory builds. The upward price movement for both benchmarks comes on new optimism that the United States and China trade war will simmer down after China said it would hold trade talks with the US.
At 12:18pm EDT, the WTI benchmark was trading up $1.12 (+2.38%) at $48.21, with Brent crude trading up $1.32 (+2.36%) at $57.27 per barrel.
Canada's oil and gas rigs for the week increased by 6 rigs this week, a figure that pales in comparison to the 100 rigs or so that were lost in the last three weeks as the industry prepared for winter season. Canada's total oil and gas rig count is now 76, which is 98 fewer rigs than this time last year, with a 5-rig increase for oil rigs, and a 1-rig increase for gas rigs for the week.
The EIA's estimates for US production for the week ending December 21 is still keeping a lid on prices, fighting OPEC's production cuts every step of the way. US production averaged 11.7 million bpd for the week.
By 1:08pm EDT, WTI had increased by 1.95% (+$0.92) at $48.01 on the day. Brent crude was trading up 2.09% (+$1.17) at $57.12 per barrel.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More
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Comments
For most of the past 2 years, a majority of the rig count data by Baker Hughes has reported increases.
Every time it does, nothing happens to the price of oil...
Not on the Fridays when it is reported,
Not 2 days later on Sunday evening (when Globex opens for trading),
Certainly not on the Mondays after the Friday rig count data.
So, in other words, a bearish report from Baker Hughes means nothing to the market.
That is to say that if you trade oil on Fridays and anticipate a drop in price following the release of rig count data from Baker Hughes, you will be disappointed.
Yet, with any decrease in rig count, you can definitely count on prices increasing: Every. Single. Time. They will increase on Friday, on Sunday evening, on Monday, and even into Tuesday on such "bullish" news.
This "Supports Crude Prices" and the fact that WTI was already up at least 2% or more than $1/bbl on an EIA report showing significant builds in both gasoline and distillate stocks, along with no draw in oil stocks. Go ahead. Tell me about a time when the opposite occurred.
Double-standards? I think so!