Crude oil rig counts
Last week, Baker Hughes published its active crude oil rig count report on September 18, 2015. The data showed that the active crude oil rig count fell by eight to 644 for the week ending September 18, 2015. Likewise, the crude oil rig count fell by ten to 652 for the week ending September 11, 2015. The active US crude oil rig count fell for the third consecutive week for the week ending September 18, 2015. The crude oil rig count fell in the direction of crude oil prices.
Crude oil rig counts in 2014
The current crude oil rig counts are 59% less than the 2014 levels. They’re 957 rigs lower than 1,601 rigs during the same period in 2014. Crude oil rigs fell due to lower crude oil prices. Prices fell due to long-term oversupply concerns. As a result, drilling activity fell 60% from the peak of 1,609 in October 2014 to 628 in June 2015.
The falling crude oil rigs suggest that crude oil production could fall more. The fall in crude oil production could boost crude oil prices in the long term. The rise in crude oil prices over the long term might increase the drilling activity again. The rise in drilling activity benefits oil drillers like Schlumberger (SLB), Superior (SPN), and Halliburton (HAL). In contrast, rising production from the Middle East and weak demand cues will continue to put pressure on crude oil prices and oil drillers in the short term.