Natural gas rig count falls
Baker Hughes (BHI) releases the weekly crude oil and natural gas active rig count every Friday. The weekly natural gas rig count is scheduled to release on June 19, 2015. Last week, Baker Hughes reported that active natural gas rigs fell by one to 221 for the week ending June 12, 2015. The weekly active natural gas rigs fell for the third time in the last five weeks. The total crude oil and gas rigs also fell by nine to 859 for the week ending June 12, 2015. In 2014, the total crude oil and active natural gas rigs were at 1,854.
The long-term downtrend of natural gas prices impacts the oil and gas drilling activity. As a result, oil and gas drilling fell from the peaks in 2014. Currently, gas rigs are 28% lower than the level of 310 in 2014. Lately, oil and natural gas rigs’ fall has slowed down. The recent rise in oil and gas prices might support drilling activity. This is positive for oil drillers like Schlumberger (SLB), Baker Hughes (BHI), and Halliburton (HAL).
In its monthly drilling and productivity report, the EIA (U.S. Energy Information Administration) forecasted that natural gas production may slow down in July 2015. Slowing production and renewed demand from electric power plants could support natural gas prices. Higher natural gas prices might boost oil and gas exploration as well as producers’ confidence. This will raise the drilling activity. Falling natural gas rigs might slow down more.