Weekly US crude oil rig count  

On October 14, 2016, Baker Hughes (BHI) released its weekly US crude oil rig count. It reported that the US crude oil rig count rose by four to 432 rigs from October 7–14, 2016. The US crude oil rig count rose for the 15th time in the last 16 weeks. The number of active rigs rose as crude oil prices recovered from lows earlier this year.

US Crude Oil Rig Counts Rose by 4 Last Week: What Does It Mean?

The rise in the rig count could slow down the pace of falling US crude oil production and pressure crude oil prices again. For more on crude oil prices, read part one of this series.

The rise in US drilling activity could have a positive impact on oil production. It could also have a positive impact on companies’ earnings such as Transocean (RIG), Rowan Companies (RDC), Diamond Offshore (DO), Baker Hughes (BHI), Halliburton (HAL), and Laredo Petroleum (LPI).

The US crude oil rig count has fallen 27.4% YoY (year-over-year), but it has risen 0.9% week-over-week.

The US crude oil rig count’s peaks and lows 

The US crude oil rig count peaked at 1,609 in October 2014. In contrast, it hit 316 in the week ending May 27, 2016, the lowest level since the 1940s. The US drilling activity fell due to lower crude oil prices. The lower prices were due to oversupply. The US crude oil rig count has risen by 116 rigs from the lows in May 2016.

US Crude Oil Rig Counts Rose by 4 Last Week: What Does It Mean?

EIA’s monthly drilling report 

The EIA (U.S. Energy Information Administration) released its monthly Drilling Productivity report on October 17, 2016. It estimates that US crude oil production will fall in the seven shale regions by 30,000 barrels per day to 4.4 million barrels per day in November 2016 compared to the previous month. Production is expected to fall in the Eagle Ford and Bakken Shale regions during the same period.

Monthly international rig count 

Baker Hughes’s international oil rig count excludes data in the US and Canada. It showed that oil rigs rose by six rigs to 684 for September 2016 compared to the previous month. The count rose 0.9% month-over-month. However, it fell by 187 rigs, or 21.5%, YoY.

Impact on ETFs  

The roller coaster ride in oil and gas prices impacts oil producers and drillers. It also impacts funds such as the VelocityShares 3x Long Crude Oil ETN (UWTI), the Fidelity MSCI Energy ETF (FENY), the Guggenheim S&P 500 Equal Weight Energy ETF (RYE), the ProShares Ultra Bloomberg Crude Oil ETF (UCO), and the PowerShares DWA Energy Momentum ETF (PXI).

In the next part of this series, we’ll take a look at the Commodity Futures Trading Commission’s “Commitments of Traders” report.

Latest articles

Broadcom (AVGO) stock fell ~8.5% after markets closed yesterday following the semiconductor giant's fiscal 2019 second-quarter earnings release. It missed analysts' revenue estimate and cut its fiscal 2019 revenue guidance by $2 billion to $22.5 billion due to sluggishness in its semiconductor solutions business.

The SPDR Gold Shares ETF (GLD), which tracks physical gold prices, has underperformed the broader markets year-to-date, rising just 4.4% compared to the S&P 500’s (SPY) gain of 15.9% as of June 14. The sentiment for gold, however, has been turning around.

Safe havens such as Treasuries and gold were back in favor on June 14 as stocks fell due to rising tensions in the Middle East, concerns over growth, and the looming threat of the US-China trade war. The tech-heavy Nasdaq Composite Index fell 0.67% in the first hour of trading.

Lululemon (LULU) stock rose 2.1% on June 13 in reaction to better-than-expected first-quarter results and an upgraded outlook for fiscal 2019 overall. The company's first-quarter adjusted EPS grew 34.5% to $0.74 on revenue growth of 20.4% to $782.32 million. Analysts had expected EPS of $0.70 and revenue of $755.31 million. Here's why the outlook got an upgrade.

14 Jun

IEA Again Slashes Its Oil Demand Growth Estimate

WRITTEN BY Rabindra Samanta

As of 4:40 AM Eastern Time today, US crude oil active futures were at $51.83, ~4% below their closing level in the previous week. If US crude oil prices stay at those levels today, they'll mark their third week of decline in five weeks.

Amazon is discontinuing its Amazon Restaurants service, which has been delivering food for restaurants in parts of the United States. Amazon Restaurants launched in the United States in 2015 and entered the British market the following year. However, it met strong opposition in the British market.