((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto))
(Additional Details) by Scott DiSavino
U.S. energy companies this week kept the number of oil and natural gas drilling rigs unchanged for the second straight week, energy services company Baker Hughes BKR.O said in its closely watched report on Friday.
The oil and gas installation count, an early indicator of future production, remained at 589 during the week of December 20. RIG-USA-BHI
RIG-OL-USA-BHI RIG-GS-USA-BHI
According to Baker Hughes, the total number of drilling rigs fell by 31, down 5% from the same time last year.
Baker Hughes said the number of oil rigs increased by one unit to 483, while the number of natural gas rigs decreased by one unit to 102. of oil drilling rigs is the highest since September.
The number of oil and gas drilling rigs fell by about 20% in 2023 after increasing by 33% in 2022 and 67% in 2021, due to falling oil and gas prices, rising labor and equipment costs due to soaring inflation and businesses focusing on paying down debt and increasing return for shareholders rather than on increasing production.
U.S. oil futures CLc1 were unchanged after the Baker Hughes data, leaving them down about 3% year to date after falling 11% in 2023. Futures on US gas NGc1 are up about 49% so far in 2024 after falling 44% in 2023.
The 25 independent exploration and production (E&P) companies tracked by U.S. financial services firm TD Cowen said that on average, E&Ps planned to leave their spending in 2024 roughly unchanged from 2023.
In comparison, spending will increase by 27% in 2023, 40% in 2022 and 4% in 2021.
U.S. crude production is on track to rise from a record 12.9 million barrels per day (bpd) in 2023 to 13.2 million bpd in 2024 and 13.5 million bpd in 2025, according to latest outlook from the U.S. Energy Information Administration (EIA).
On the gas side, several producers have reduced drilling activity this year after the monthly average spot price at the Henry Hub NG-W-HH-SNL benchmark in Louisiana fell to its lowest level since 32 in March, and remained relatively low in the months that followed.
This reduction in drilling activity is expected to cause U.S. gas production to decline for the first time since the COVID-19 pandemic reduced fuel demand in 2020.
The EIA projects gas production to fall to 103.2 billion cubic feet per day (bcfd) in 2024, from a record 103.8 bcfd in 2023.
