Overall U.S. Rig Count Up Slightly
Enverus reported that U.S. drillers this week added oil and natural gas rigs for the second time in three weeks as a recent increase in energy prices from coronavirus-linked lows prompted some to return to the wellpad.
The Anadarko Basin lost six rigs, the Marcellus/Utica lost four and the Denver-Julesburg Basin lost one. Outside of major onshore basins, however, nine rigs were added in the last week.
The U.S. rig count is up 3% in the last month but down 68% year-over-year. The count has been below 300 since June 3. Third-quarter levels to date have averaged 280 and stayed within a 29-rig range, indicating a stable level of activity for the quarter—but not a recovery.
Even though U.S. oil prices are still down about 33% since the start of the year due to the demand effects of coronavirus, crude futures have gained 118% over the past five months to around $41/bbl on Sept. 18 on hopes global economies and energy demand will snap back as governments lift more lockdowns.
Analysts said those higher oil prices have encouraged some energy firms to start drilling more and expect that activity will begin/continue inching higher into (year-end 2020) and remain optimistic that September may represent the trough. U.S. financial services firm Cowen & Co. said that some E&Ps issued early estimates for 2021 that so far point to 8% drop in spending next year versus 2020.
Trends
Recommended Reading
US Decision on Venezuelan License to Dictate Production Flow
2024-04-05 - The outlook for Venezuela’s oil industry appears uncertain, Rystad Energy said April 4 in a research report, as a license issued by the U.S. Office of Assets Control (OFAC) is set to expire on April 18.
US Orders Most Companies to Wind Down Operations in Venezuela by May
2024-04-17 - The U.S. Office of Foreign Assets Control issued a new license related to Venezuela that gives companies until the end of May to wind down operations following a lack of progress on national elections.
US Threatens to Not Renew Venezuelan Energy Sector License
2024-01-31 - The U.S. Department of State alerted Venezuela that it could decide not to renew General License No. 44 amid what Washington has labeled “anti-democratic actions.”
Renewed US Sanctions to Complicate Venezuelan Oil Sales, Not Stop Them
2024-04-19 - Venezuela’s oil exports to world markets will not stop, despite reimposed sanctions by Washington, and will likely continue to flow with the help of Iran—as well as China and Russia.
CEO: Linde Not Affected by Latest US Green Subsidies Package Updates
2024-02-07 - Linde CEO Sanjiv Lamba on Feb. 6 said recent updates to U.S. Inflation Reduction Act subsidies for clean energy projects will not affect the company's current projects in the United States.