((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto))
The number of oil and natural gas drilling rigs remained unchanged this week for the third consecutive week, energy services company Baker Hughes BKR.O said in its closely watched report on Friday.
The number of oil and gas installations, an early indicator of future production, remained unchanged at 589 in the week ending December 27.
RIG-USA-BHI RIG-OL-USA-BHI RIG-GS-USA-BHI
According to Baker Hughes, the total number of drilling rigs decreased by 33, or 5.3%, compared to the same period last year.
Baker Hughes reported that the number of oil and gas drilling rigs remained stable this week at 483 and 102, respectively.
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 lower oil and gas prices, increased costs of labor and equipment due to soaring inflation and as businesses focused on paying down debt and increasing of return for shareholders rather than on increasing production.
U.S. oil CLc1 futures are down about 2% so far in 2024 after falling 11% in 2023, while U.S. gas NGc1 futures are up about 43% so far in 2024. ‘now in 2024 after falling 44% in 2023.
For the year, the total number of oil and gas rigs declined for the second year in a row, the first time since 2020.
U.S. crude oil production was on track to increase 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 the 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.
