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U.S. Rig Counts Slowly Rising

by Elizabeth Alford on August 1, 2016

Oil and gas operators are slowly putting rigs back into play, just a crude falls closer to $40.

Related: U.S. Active Rig Count Falls to 406

A total of 460 oil and gas rigs were running across the United States this week, the highest level since March. Baker Hughes reports there were 86 rigs targeting natural gas and 374 were targeting oil in the U.S. The remainder were drilling service wells (e.g. disposal wells, injection wells, etc.)

Counting rigs has historically been an indicator of the health of the oil and gas industry and an indicator of future production. But during busts, some analysts suggest that looking at the number of rigs doesn’t give them the whole picture.

When the industry’s drilling activity recovers, more efficient oil companies will need fewer than half the number of rigs used at the height of the oil boom to keep the nation’s fleet of hydraulic fracturing pumps busy, Halliburton CEO Dave Lesar said during a conference call with investors last week. – Fuelfix

This time last year, the rig count sat at 874 and at the end of December, there were 698 oil and gas rigs were running across the U.S. That number dropped to its lowest point at 403 in May.

Oil prices have continues to fluctuate, falling last week closer to the $40 mark. Nasdaq is reporting WTI at $41.21 this morning, a steep drop since spiking over $52 in June.

 

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