US rig count falls as Texas, Permian lead losses: Baker Hughes

Quantum Commodity Intelligence – North American drilling activity returned to negative growth during the second week of July, posting a 10th weekly loss for the previous 11 weeks, oilfield services firm Baker Hughes reported.

The total weekly rig count fell by six units to 675 the week ending 14 July, which is 81 rigs below the same stage last year, or down 11%.

Oil rigs continued to decline, dropping by another three to 537, some 62 fewer than at the same stage in 2022, while natural gas fell by two units to 133, 20 fewer on the year.

Texas lost a significant eight rigs falling to 329 and is now 36 fewer than a year ago, while the Permian Basin, spanning West Texas and New Mexico, was down five at 337 and 13 lower from year-ago levels.

US output last week dipped from post-pandemic highs of around 12.3 million bpd, although drillers remain confident of higher production with focus shifting to the more productive regions.

NYMEX WTI trading on the Chicago Mercantile Exchange settled on Friday (14 July) at $74.71/b for the Aug23 contract, up 1.2% for a second weekly gain. Meanwhile, the global crunch on heavier crude barrels has boosted US Gulf Mars Blend to a multi-year high of around $2/b over WTI Cushing.

Front-month Sep23 ICE Brent futures closed at $79.87/b, up 1.8% over the same timeframe.

Natural gas was little changed over the week as the Aug23 Henry Hub contract on NYMEX closed at $2.539/mmBtu on Friday, down 1.6%, as soaring production and healthy inventories more than coped with the increased summer demand.