News Oil & Gas

U.S. oil & gas rig count falls to lowest since late July – Baker Hughes

Sept 9 (Reuters) – U.S. energy firms this week cut the
number of oil and natural gas rigs operating to the lowest since
late July as the growth in the rig count and production has
slowed despite relatively high energy prices.

The U.S. oil and gas rig count, an early indicator of future
output, fell by one to 759 in the week to Sept 9, down for the
fifth week in six, energy services firm Baker Hughes Co
said in its closely followed report on Friday. <RIG-USA-BHI>

Despite the decline, the rig count was still up 256, or 51%,
over this time last year.

U.S. oil rigs fell five to 591 this week, their lowest since
mid June, while gas rigs rose four to 166, their highest since
August 2019.

With oil prices up about 16% so far this year after soaring
55% in 2021, the total rig count fell in August after rising for
a record 24 months in a row.

But even when rising, weekly increases have mostly been in
the single digits as many companies focus more on returning
money to investors and paying down debt rather than boosting

Supply chain constraints and inflationary pressures also
mean disappointing oil output gains, chief executives of shale
oil producers EOG Resources and Pioneer Natural
Resources said this week.

Scott Sheffield, CEO of leading shale producer Pioneer said
those limitations are “going to keep people from drilling too
much in the Permian,” the largest U.S. oilfield which has
supplied most of the American oil gains in recent years.

Sheffield forecast U.S. oil production will rise around
500,000 barrels per day (bpd) this year, and next year’s gains
could fall below that level. His estimate is well below the
800,000 bpd projection for 2023 by the U.S. Energy Information
Administration (EIA).

The EIA this week cut its forecast for 2022 oil output to
11.8 million bpd, down 100,000 bpd from a previous forecast. It
also lowered its 2023 outlook by 100,000 bpd, to an average 12.6
million bpd.

However, top oilfield services company Schlumberger
on Wednesday said North American oil and gas activity was
growing at a faster pace than expected, as investments rates

U.S. financial services firm Cowen & Co said the independent
exploration and production (E&P) companies it tracks plan to
boost spending by about 35% in 2022 versus 2021 after increasing
spending about 4% in 2021 versus 2020.
(Reporting by Scott DiSavino
Editing by Marguerita Choy)

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