Continuing its downward spiral, the North American rig count ended the week of May 6 at 451, down six rigs from the previous week.
The latest Baker Hughes rig count report showed the U.S. rig count fell by five to 415. The U.S. oil rig count dropped by four to 328, while the gas rig count landed at 86, down one.
The Canadian count ended the week at 36, down one. There was one more oil rig running this week compared to last, but two fewer gas rigs.
However, the major basin breakdown showed two basins picked up rigs this week while counts in others remained unchanged or down. Baker Hughes reported the Permian rig count jumped by five to 139 this week and the Mississippian count inched up by two to six. There was also one more rig drilling in the Granite Wash this week compared to last. The count here rose by one to four rigs.
But rising oil prices could signal a turnaround is approaching.
Reuters reported the U.S. rig count may be bottoming out as oil companies such as Anadarko Petroleum and Pioneer Natural Resources look to improved oil price outlooks.
“The U.S. rig count generally reacts to prices with a three- or four-month lag, so following the nadir for crude in February, it should bottom in the next month,” Reuters reported, citing Morgan Stanley’s head of energy commodity research Adam Longson’s comments in a report this week.
“The same analysis also suggests a notable increase in rig activity may be ahead—potentially reversing much of the decline over the past several months,” he wrote.
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