In the week ended October 30, the number of rigs drilling for oil in the United States totaled 578, compared with 594 in the prior week and 1,582 a year ago. Including 197 other rigs drilling for natural gas, there are a total of 775 working rigs in the country, down from 787 week over week and down from 1,154 year over year. The data come from the latest Baker Hughes Inc. (NYSE: BHI) North American Rotary Rig Count.
Benchmark West Texas Intermediate (WTI) crude oil for December delivery rose by about $1.50 a barrel over the past five days to close the week up about 4.5% at $46.39, after rising above $47 briefly. Brent crude closed at $49.50 on Friday.
Both Exxon Mobil Corp. (NYSE: XOM) and Chevron Corp. (NYSE: CVX) reported third-quarter results Friday before the markets opened. Both companies reported better-than-expected profits and revenues, but both also plan to cut capital spending, and Chevron said it would fire 6,000 to 7,000 people and aims to sell assets worth $5 billion to $10 billion by the end of 2017.
Neither company touched its dividend, but one large independent producer did. Marathon Oil Corp. (NYSE: MRO) slashed its quarterly dividend from $0.21 to $0.05. The “lower-for-longer” price environment is very likely to put more pressure on independent producers, and Marathon was just the first of what could be several to take this step.
Marathon’s market cap is around $12.5 billion, which puts it at the low end of the independent producers with a market value in the double-digit billions. There are six more companies with market caps below $20 billion and five are reporting results next week: Apache, Devon, Noble Energy, Concho and Continental.