Natural gas rig count
Oil equipment company Baker Hughes (BHI) releases its natural gas rig count every Friday. BHI is releasing its weekly US natural gas rig count report on November 20, 2015.
Last week, the natural gas rig count fell by six to 193 for the week ending November 13, 2015. On the other hand, the gas rig count rose by two to 199 for the week ending November 6, 2015. The natural gas rig count resumed its long-term downward trend last week after rising for the previous five weeks.
Natural gas rig count trend
The long-term trend of the natural gas rig count has been downward. This is because natural gas prices fell more than 30% in the last year due to massive supplies outpacing demand. Excess supplies led to a fall in drilling activity.
Current drilling activity is 45% lower than the rig count of 350 in 2014. The fall in drilling activity impacts drillers such as Baker Hughes, Schlumberger (SLB), Superior Energy Services (SPN), and Halliburton (HAL).
Natural gas prices have fallen more than 7% in November 2015. The bearish trend of natural gas prices and natural gas rigs suggests that oil and gas producers are less optimistic about higher natural gas prices. We could see natural gas rigs drop further in the near term.
The EIA (U.S. Energy Information Administration) estimates that natural gas production could fall by 394 million cubic feet per day in December 2015 over November 2015.