Rig Count Drops Again | Russell T. Rudy Energy LLC
According to a recent article in “World Oil”, the U. S. oil rig count dropped for the 25’th straight week. This time the count decreased by 13 to 646, the lowest level since August of 2010. Most of the reductions were outside the major shale basins with rig counts in the Eagle Ford, Bakken and Permian all remaining relatively stable.
The Eagle Ford in South Texas actually gained a rig last week, and the Bakken shale of North Dakota and the Permian Basin of West Texas and Southeast New Mexico each lost one. Some industry observers see the rig count as bottoming out with an upswing in the near future. James Williams, president of consulting firm WTRG Economics, observed “The major basins aren’t bleeding as much as they were, so we’re near the bottom. We should see a moderate upward move in rigs sometime next month.”
However, the fall-off in drilling activity has not yet had an adverse effect on domestic crude production. During the week ended May 22, we pumped 9.57 million barrels of oil per day, the most since 1983, according to the Energy Information Administration.
Green shoots of optimism seem to be sprouting in the oil patch. Andrew Bradford with Raymond James investments stated “Most service companies we speak with feel that ‘the bottom is in’ for U. S. drilling. Our estimates had forecast a bottom in mid-June followed by a painstakingly slow recovery until mid-to late fall, at which point the recovery pace picks up modestly.”
To read the article in its entirety, please go to http://www.worldoil.com/news/2015/5/29/oil-drilling-retreat-in-us-drags-on-for-25th-straight-week .
