US natural gas rig count
On September 22, 2017, Baker Hughes (BHI) will release its US natural gas rig count report. In the previous week’s report, the US natural gas rig count fell by one to 186 on September 8–15, 2017. The US natural gas rig count is at the lowest level since July 21, 2017. Rigs fell due to lower crude oil (USO) (UWT) and natural gas (UNG) (DGAZ) prices in the past few months.
Volatility in crude oil and natural gas prices impacts drilling and production activity. It also impacts drillers and producers’ (XES) (IEZ) earnings like Rowan Companies (RDC), Atwood Oceanics (ATW), Gulfport Energy (GPOR), Newfield Exploration (NFX), and Diamond Offshore (DO).
Monthly drilling productivity report
The EIA (U.S. Energy Information Administration) released its monthly “Drilling Productivity Report” on September 18, 2017. It estimates that US natural gas production will rise in the seven shale regions by 788 Mcf (million cubic feet) per day to 59,745 Mcf per day in October 2017—compared to September 2017.
US natural gas production is expected to rise mainly in the Appalachia, Permian, and Haynesville shale regions in October 2017.
The number of active US natural gas rigs is at a nine-week low. The number of active oil and gas rigs could rise if crude oil and natural gas prices trade firm. However, rising rigs could bring more supply to the market, which would pressure prices.
In the next part, we’ll discuss how OPEC’s meeting could impact US natural gas production and prices.