US weekly oil rig count eases, WTI price spike seen unlikely to boost rig demand

Quantum Commodity Intelligence - North American drilling activity dipped for the first time in nearly a month for the week ending October 7, oilfield services firm Baker Hughes reported.

The total weekly rig count was down by three units to 762, although the count is still 229 more than the 533 counted at the same time in 2021.

The number of rigs dedicated to crude was down by two units, standing at 602, while the number of rigs drilling for natural gas eased by one to stand at 158.

Texas was unchanged at 360 units, while the Permian Basin edged up one to 344. Permian, which is spread across west Texas and New Mexico, produced around 5.3 million barrels per day in September.

Last week US benchmark WTI prices spiked at the fast rate since Russia's invasion of Ukraine, as global oil markets reacted positively to initial speculation that OPEC+ was set for a steep reduction in output, followed by announcing a headline cut of 2 million bpd.

Benchmark NYMEX WTI settled Friday at a five-week high of $92.64/b for the Nov22 contract, up 16.5% versus the previous week's close of $79.49/b.

Analysts said that the rebound in crude oil prices was unlikely to have much impact on immediate drill-rig demand with other constraints in place including environmental and regulatory controls, along with a lack of access to investment capital.