US drill rig count lower on Texas, Permian declines: Baker Hughes

Quantum Commodity Intelligence - North American drilling activity was lower the week ending 3 March, registering a third consecutive weekly loss for the first time since last August, oilfield services firm Baker Hughes reported.

The total weekly rig count eased by four units to 749, although it was still up around 15% from the same time last year.

The number of rigs dedicated to crude dipped by eight to 592, the lowest count since last September. Rigs drilling for natural gas increased by three to 154, up 24 on the year.

Texas dropped by four rigs to 366 units but was still up 58 on the year, while the Permian Basin, spread across West Texas and New Mexico, was also down four rigs at 352 for an increase of 44 on the year.

On the production front, the EIA called total output steady in its latest release at 12.3 million bpd, which remains the highest figure since prices collapsed in April 2020.

Last week, US major Chevron laid out plans to increase production by about 30% in the next four years, with most of that growth in the US.

An extra 750,000 bpd of oil is expected from the company's assets in the Permian basin and the Gulf of Mexico by 2027, with an additional 130,000 bpd in Kazakhstan.

NYMEX WTI trading on the Chicago Mercantile Exchange settled on Friday (3 March) at $79.68/b for the Apr23 contract, up 4.4% on the week.

Front-month Apr23 ICE Brent futures closed Friday at $85.83/b, up 4% over the same timeframe.

Natural gas prices rebounded strongly following winter storms in the US and a growth in exports after the restart of the Freeport LNG terminal, with the Apr23 Henry Hub contract on NYMEX closing up 22% on the week at $3.1/mmBtu.