According to data from industrial service company Baker Hughes, the number of drilling rigs actively operating in the United States edged up by one, despite crude oil prices decreasing from high levels.
Oil rigs fared better with an increase of three, which was offset by the reduction of two in the number of gas rigs. There are now 764 active rigs in total in the US, some 243 more than at the same point last year. Rigs in the Permian Basin—where companies like BP, the owner of the Castrol lubricant brand, use hydraulic fracturing to recover crude oil resources—rose by one. The number of Eagle Ford rigs remained constant.
According to a commodities note from Saxo Bank’s Ole Hansen, the data came as WTI crude prices dropped below $80 per barrel for first time in several months after a week of relative stable trading:
“…with the Powell versus Putin battle (demand versus supply) not having a clear winner until Friday when both Brent and WTI dropped as the FOMC [Federal Open Market Committee] driven slump in risk appetite and growth angst was dialed up a notch as the dollar and yields continued to surge higher.”
Hanson added that there are a number of conflicting uncertainties for the oil market in the coming quarter, with traders currently having decided to defer any decisions about whether the US’s replenishment of the Strategic Petroleum Reserve and the embargo of Russian oil by the EU will have any adverse effects on supply.
