U.S. energy firms this week cut the number of oil and natural gas rigs operating for a sixth week in a row for the first time since September 2023, energy services firm Baker Hughes said in its closely followed report on June 6.
The oil and gas rig count, an early indicator of future output, fell by four to 559 in the week to June 6, the lowest since November 2021.
Oil rigs fell by nine to 442 this week, while gas rigs rose by five to 114, Baker Hughes said.
It said it has corrected oil and gas classifications for approximately eight to 10 rigs in the Marcellus and Utica basins, effective April 4. Total reported rig counts for all historical periods remain unchanged.
The oil and gas rig count declined by about 5% in 2024 and 20% in 2023 as lower U.S. oil and gas prices over the past couple of years prompted energy firms to focus more on boosting shareholder returns and paying down debt rather than increasing output.
The independent E&P companies tracked by U.S. financial services firm TD Cowen said they planned to cut capex by around 3% in 2025 from levels seen in 2024.
That compares with roughly flat year-over-year spending in 2024, and increases of 27% in 2023, 40% in 2022 and 4% in 2021.
Even though analysts forecast U.S. spot crude prices would decline for a third year in a row in 2025, the U.S. Energy Information Administration (EIA) projected crude output would rise from a record 13.2 MMbbl/d in 2024 to around 13.4 MMbbl/d in 2025.
On the gas side, the EIA projected an 88% increase in spot gas prices in 2025 would prompt producers to boost drilling activity this year after a 14% price drop in 2024 caused several energy firms to cut output for the first time since the COVID-19 pandemic reduced demand for the fuel in 2020.
The EIA projected gas output would rise to 104.9 Bcf/d in 2025, up from 103.2 Bcf/d in 2024 and a record 103.6 Bcf/d in 2023.
Recommended Reading
Second Pearsall Wildcat in Frio County IPs 1,300 bbl/d
2025-04-21 - Formentera Partners’ second Pearsall well joins Indio Tanks-Pearsall Field’s first modern frac job Hurrikain Cat I-STX, which IP’ed 1,499 bbl earlier this year.
Formentera Drilling Two More Pearsall Wildcats After Initial Success
2025-06-02 - In their first 2.5 months online, Formentera Partners’ initial two tests are averaging more than 1,000 boe/d, according to Texas Railroad Commission data.
Formentera Partners’ Pearsall Wildcat IP’s 1,499 bbl in Frio County
2025-04-15 - Formentera Partners’ 1.5-mile Hurrikain Cat I-STX #S731H’s lateral was made in Pearsall at about 10,000 ft, updip of where past Pearsall tests results were mostly gassy.
EOG, SM, Magnolia Ramp Up Austin Chalk Development for NatGas Growth
2025-04-17 - As Tier 1 Eagle Ford inventory declines, EOG, SM and Magnolia are accelerating development in the overlying Austin Chalk to sustain South Texas output.
Encino Led Ohio’s 11% Utica Oil Output Growth in 1Q25
2025-06-11 - Most of the state’s additional barrels came from Encino Energy, which EOG Resources plans to buy for $5.6 billion, new state production data show.
Comments
Add new comment
This conversation is moderated according to Hart Energy community rules. Please read the rules before joining the discussion. If you’re experiencing any technical problems, please contact our customer care team.