Crude oil rig count
Baker Hughes (BHI) released its weekly oil and gas rig report on July 2, 2015. For the week ending July 3, 2015, crude oil rigs rose massively by 13 to 641, according to Baker Hughes sources. In contrast, the crude oil active rig count fell by three to 628 for the week ending June 26, 2015.
Weekly US crude oil rigs rose for the first time in 2015. Since the previous week, crude oil rigs fell for 29 consecutive weeks. The last time the crude oil rig count rose was by three to 1,575 for the week ending May 12, 2015. Currently, crude oil rigs are 59% lower than the level of 1,562 in 2014.
The rise or fall in crude oil rigs determines the confidence of oil and gas producers. The rise in the rig count signifies a possible rise in crude oil and natural gas production on the anticipation of higher crude oil prices. In contrast, the fall in oil and gas rigs means a possible saturation in oil and gas production or a future fall in production. The rig count acts a barometer. It shows upstream companies’ confidence.
Oil prices rose more than 6% in 2015, despite losing more than 40% in 2015. The recent surge in oil prices and the rise in crude oil rigs signifies oil and gas producers’ rising confidence. This benefits oil and gas drillers like Schlumberger (SLB), Baker Hughes, and Halliburton (HAL).