U.S. Land Rigs Drop to 834
The BHI land rig count dropped -10 rigs (or -1.2%) to 834 rigs from last week’s 844. The WTI crude oil price closed last week at about $60 per barrel. Oil-directed rigs dropped -12 rigs (or -1.9%) to 619 from last week’s 631. Compared to this time last year, oil-directed rigs are down -58%.
Summary of Shale Plays
- Permian Basin -0.4% to 232 rigs, compared to last week’s 233 rigs
- Eagle Ford +2.8% to 110 rigs, from last week’s 107 rigs
- Williston Basin -1.3% to 77 rigs, from last week’s 78
- Marcellus -4.5% to 63, from last week’s 66 rigs
- Mississippian stayed flat at 22 rigs
- DJ-Niobrara stayed flat at 30 rigs
- Utica +4.2% to 25, from last week’s 24 rigs
- Cana Woodford stayed flat at 34 rigs
- Haynesville -3.7% to 26 rigs, from last week’s 27 rigs
What’s next for Commodity Prices?
In January, oil prices plunged to $45 per barrel. E&Ps reacted strongly by cutting budgets and many oilfield service companies closed offices, cut staff, and reorganized operations. The industry adjusted to this new reality from each individual and company perspective.
Talking to industry veterans, many are preparing for lower oil prices while hoping for oil to return to $70 per barrel. At this price, companies like EOG will return to full drilling and completion activity.
OPEC is likely to gain more attention this week. According to two OPEC delegates, they expect no changes at the June 5th policy meeting. Oil gained last week again, showing strength going into summer and into the OPEC meeting.