uploads/2015/04/Oil-rig-graph1.jpg

US Crude Oil Rig Count Down for 18 Straight Weeks

By

Updated

Oil rig counts at their lowest level since December 2010

Oilfield services company Baker Hughes (BHI) reported that the US crude oil rig count decreased by 42 for the week ending April 10 compared with the previous week—down from 802 to 760. The number of oil rigs is now at its lowest level since December 17, 2010. Last week’s decline in oil rigs was the highest it’s been in the last four weeks.

The steepest decline in oil rigs since 1990 occurred on January 30, 2015, when the weekly oil rig count decreased by 94.

The latest figures mark the 18th consecutive weekly fall in crude oil rig counts. In those 18 weeks, the crude oil rig count has crashed by 815.

Article continues below advertisement

Among the major resource shales, the main reductions occurred in the Permian Basin located in western Texas and southern New Mexico, where the oil rig count dropped by 20 last week. In the Eagle Ford Shale in south Texas, the oil rig count decreased by 14. Please read Part 5 of this series to learn more about the Permian Basin rig count.

The crude oil rig count has fallen by 849, or 53%, since hitting its peak of 1,609 rigs on October 10, 2014, the most since January 2005.

Producers are at risk

When oil prices continued to dip, oil producers such as Whiting Petroleum (WLL), Marathon Oil (MRO), Hess Corporation (HES), and Continental Resources (CLR) took a hit. MRO and WLL together account for 2.5% of the SPDR S&P Oil & Gas Exploration & Production ETF (XOP).

To explore the latest crude oil price movements, please read US Crude Production Declines as Cushing Continues to Pressure WTI.

One-year oil rig count comparison

In the last year, the number of oil rigs in operation has dropped by 757, or ~50%. In comparison, the numbers grew by 130 during the corresponding period in the previous year. Activity in the oil-rich Permian Basin in West Texas drove most of the 2014 increase.

Read the next part of this series for more on the natural gas rig count.

Advertisement

More From Market Realist