US Oil Rig Count Rises by 2, Crude on Track for 2% Weekly Gain

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In the week ending August 31, 2018, the number of land rigs drilling for oil in the United States totaled 862, a gain of two compared to the previous week and up by 103 compared with a total of 759 a year ago. Including 184 other land rigs drilling for natural gas and two listed as miscellaneous, there are a total of 1,048 working rigs in the country, four more than a week ago and up by 105 year over year. The data come from the latest Baker Hughes North American Rotary Rig Count released on Friday afternoon.

West Texas Intermediate (WTI) crude oil for October delivery settled at $70.25 a barrel on Thursday and traded down about 0.3% Friday afternoon at around $70.05 shortly before regular trading closed. WTI was on track to close the week up by around 2.1%. Brent crude for November delivery traded at $77.83 a barrel, down about 0.2% for the day.

The natural gas rig count also rose by two to come in at 184 this week. The count for natural gas rigs is now up by one year over year. Natural gas for October delivery traded up about 1.5% at around $2.92 per million BTUs, about flat compared to last Friday and up about 0.4% for the week.

Increasing trade tensions weighed on crude oil prices Friday, but black gold looked set to post a second consecutive weekly gain. WTI posted a gain of around 6% in the week ended August 24. The U.S. Energy Information Administration today released its monthly crude oil and natural gas report for June. U.S. production totaled 10.67 million barrels a day in June, up from 10.44 million barrels in May and 9.07 million barrels in June of last year. Natural gas production dipped less than 1% month over month but remains 10% higher than year-ago production of 89.4 billion cubic feet.

Among the states, Baker Hughes reports that Kansas, Louisiana and Pennsylvania added one rig each this week. New Mexico and Oklahoma each lost one rig.

In the Permian Basin of west Texas and southeastern New Mexico, the rig count now stands at 486, one more compared with the previous week’s count. The Eagle Ford Basin in south Texas has 78 rigs in operation, down week over week by one, and the Williston Basin (Bakken) in North Dakota and Montana has 52 working rigs, unchanged for the week.

Producers lost two horizontal rigs this week, and the count fell to 917, while offshore drillers reported a total of 16 rigs, unchanged compared with the previous week’s count.