US oil rig count down after modest growth over weeks

Oilfield services firm Baker Hughes Inc announced Friday that the number of rigs exploring for or producing oil and natural gas in the US last week was down by 8 to a total of 877.

A report from Pulse Headlines said the drop in operating rigs followed a slow week of growth.

According to oilfield services giant Baker Hughes, there were 675 exploratory rigs looking for oil, and 202 for natural gas at the present time. In 2014, when the price of oil was nearly twice that today, there were a total of 1,914 active rigs in the US.

Only the state of Texas did not report losses this week, gaining three rigs, while Louisiana lost six, New Mexico lost two, and Colorado, Pennsylvania, and Oklahoma each lost one. The rig counts of Alaska, Arkansas, California, Kansas, North Dakota, Ohio, Utah, West Virginia and Wyoming did not change.

Baker Hughes had been tracking rotary rigs since 1944, and in the process had emerged as a valuable resource in the oil industry. The firm started in Canada monitoring drilling activity in both its home country and in the US.

It started issuing a monthly international rig count in 1975, which did not take into account rigs in Russia and onshore China in the final number.

According to the firm, the rig counts are ''an important business barometer for the drilling industry and its suppliers. When drilling rigs are active they consume products and services produced by the oil service industry. The active rig count acts as a leading indicator of demand for products used in drilling, completing, producing and processing hydrocarbons.''

Baker Hughes said as of 28 August, the US had 877 active rigs, 8 less than last week.

Canada was also experiencing a downtrend; which continued in the past week. The country saw the number of active rigs, decline from 208 to 196. The country had 409 active rigs, a year ago.

The rig count showed a downtrend looking outside of North America, and after tumbling roughly 1 per cent, month-over-month, in June, July saw a 2.44 per cent drop in the global active rigs count, which now stood at 1118 rigs.

This was against the 1382 active rigs counted in July 2014.

In January Baker Hughes and Halliburton Co announced they would cut thousands of jobs as drilling activity slowed further after the recent steep fall in crude oil prices, Reuters reported. (See: Oilfield service providers Baker Huges, Halliburton to cut thousands of jobs).