US drillers lower oil and fuel rigs to lowest since Dec 2021, Baker Hughes says

By Scott DiSavino

(Reuters) – U.S. power corporations this week lower the variety of oil and pure fuel rigs working for a second week in a row to the bottom since December 2021, power companies agency Baker Hughes (NASDAQ:BKR) stated in its intently adopted report on Friday.

The oil and fuel rig rely, an early indicator of future output, fell by 4 to 580 within the week to Jan. 17.

Baker Hughes stated this week’s decline places the overall rig rely down 40 rigs, or 6% under this time final yr.

Baker Hughes stated oil rigs fell by two to 478 this week, their lowest since November, whereas fuel rigs additionally fell by two to 98, their lowest since September.

Within the Haynesville shale in Arkansas, Louisiana and Texas, drillers lower two rigs, bringing the overall right down to 29, the bottom since January 2017.

Within the Williston basin in Montana and North Dakota, drillers lower 4 rigs, bringing the overall right down to 33, the bottom since January 2024.

And in Louisiana, drillers lower one rig, bringing the overall right down to 29, the bottom since August 2020.

The oil and fuel rig rely declined by about 5% in 2024 and 20% in 2023 as decrease U.S. oil and fuel costs over the previous couple of years prompted power corporations to focus extra on paying down debt and boosting shareholder returns slightly than elevating output.

Despite the fact that analysts forecast U.S. spot crude costs may decline for a 3rd yr in a row in 2025, the U.S. Power Data Administration (EIA) projected crude output would rise from a report 13.2 million barrels per day (bpd) in 2024 to round 13.6 million bpd in 2025.

On the fuel facet, EIA projected a 43% improve in spot fuel costs in 2025 would immediate producers to spice up drilling exercise this yr after a 14% worth drop in 2024 brought on a number of power corporations to chop output for the primary time for the reason that COVID-19 pandemic decreased demand for the gasoline in 2020. [NGAS/POLL]

EIA projected fuel output would rise to 104.5 billion cubic toes per day (bcfd) in 2025, up from 103.1 bcfd in 2024 and a report 103.6 bcfd in 2023.