North America Adds More Rigs Week on Week

North America added nine rigs week on week, according to Baker Hughes’ latest North America rotary rig count, which was released on July 11.

Although the U.S. dropped two rigs week on week, Canada added 11 rigs during the same timeframe, taking the total North America rig count up to 699, comprising 537 rigs from the U.S. and 162 rigs from Canada, the count outlined.

Of the total U.S. rig count of 537, 522 rigs are categorized as land rigs, 13 are categorized as offshore rigs, and two are categorized as inland water rigs. The total U.S. rig count is made up of 424 oil rigs, 108 gas rigs, and five miscellaneous rigs, according to Baker Hughes’ count, which revealed that the U.S. total comprises 478 horizontal rigs, 43 directional rigs, and 16 vertical rigs.

Week on week, the U.S. land rig count reduced by two, while the country’s offshore rig count and inland water rig count remained unchanged, the count highlighted. The country’s oil and miscellaneous rig counts each dropped by one, and its gas rig count remained unchanged, week on week, the count showed. The U.S. horizontal rig count dropped by two, its directional rig count dropped by one, and its vertical rig count increased by one, week on week, the count revealed.

A major state variances subcategory included in the rig count showed that, week on week, Oklahoma and Texas each cut one rig. A major basin variances subcategory included in Baker Hughes’ rig count showed that, week on week, the Cana Woodford basin dropped three rigs, the Ardmore Woodford basin cut one rig, and the Haynesville basin added one rig.

Canada’s total rig count of 162 is made up of 112 oil rigs and 50 gas rigs, Baker Hughes pointed out. The country’s oil rig count increased by 10 week on week and its gas rig count increased by one during the period, the count revealed.

The total North America rig count is down by 74 rigs compared to year ago levels, according to Baker Hughes’ count, which showed that the U.S. has cut 47 rigs and Canada has cut 27 rigs, year on year. The U.S. has dropped 54 oil rigs and one miscellaneous rig, and added eight gas rigs, while Canada has dropped 14 oil rigs and 13 gas rigs, year on year, the count outlined.

In a research note sent to Rigzone by the JPM Commodities Research team on Friday, analysts at J.P. Morgan highlighted that “total U.S. oil and gas rigs decreased by two to 547 this week, according to Baker Hughes”.

“Oil focused rigs decreased by one to 424 rigs, after losing seven rigs last week. Natural gas focused rigs remained unchanged at 109 rigs, following a decrease of one rig week over week last week,” they added.

“The rig count in the five major tight oil basins – we use the EIA [U.S. Energy Information Administration] basin definition – decreased by one to 409 rigs. The rig count in two major tight gas basins remained unchanged at 74 rigs. The miscellaneous rig count decreased by one to five,” they continued.

The J.P. Morgan analysts went on to state in the research note that “U.S. oil rigs continued to decline this week, reaching the lowest level since September 2021”.

“After losing seven rigs last week, only one rig was lost this week. We anticipate that during July, an additional eight rigs will be lost in the main U.S. tight oil basins,” the analysts added in the note.

“Supply growth in the U.S. has started to slow down: following growth of 279,000 barrels per day in March and 219,000 barrels per day in April, growth most likely fell below 200,000 barrels per day in May and June,” they said.

“In May, this was primarily due to disruptions in the Gulf, and in June, the basins began to experience the effects of significant rig declines. We expect this pace of slower growth to continue throughout the year,” the analysts continued.

Rigzone has contacted the American Petroleum Institute (API) and the U.S. Department of Energy for comment on the JPM Commodities Research note. At the time of writing, the API and DOE have not responded to Rigzone.

In its previous rig count, which was released on July 3, Baker Hughes showed that North America added three rigs week on week. Although the U.S. dropped eight rigs week on week, Canada added 11 during the same period, that count highlighted.

Baker Hughes’ June 27 rig count showed that North America dropped six rigs week on week, its June 20 rig count revealed that the total North America rig count remained unchanged week on week, its June 13 rig count showed that North America added 20 rigs week on week, and its June 6 rig count showed that North America cut two rigs week on week.

Baker Hughes’ May 30 rig count revealed that North America dropped five rigs week on week, its May 23 count showed that North America dropped 17 rigs week on week, and its May 16 rig count showed that North America added five rigs week on week. The company’s May 9 rig count revealed that North America cut 12 rigs week on week, its May 2 count revealed that North America dropped 11 rigs week on week, and its April 25 count showed that North America dropped four rigs week on week.

Baker Hughes’ April 17 count showed that North America dropped two rigs week on week, its April 11 rig count revealed that North America cut 22 rigs week on week, the company’s April 4 rig count showed that North America cut 12 rigs week on week, its March 28 count revealed that North America cut 18 rigs week on week, and its March 21 rig count also revealed that North America cut 18 rigs week on week. Baker Hughes’ March 14 count showed that North America dropped 35 rigs week on week and its March 7 rig count revealed North America cut 15 rigs week on week.

In its February 28 rig count, Baker Hughes showed that North America added five rigs week on week. Its February 21 count revealed that North America added three rigs week on week, its February 14 rig count showed that North America dropped two rigs week on week, and its January 31 rig count showed that North America added 19 rigs week on week.

The company’s January 24 rig count revealed that North America added 12 rigs week on week, its January 17 count showed that North America added nine rigs week on week, and its January 10 rig count outlined that North America added 117 rigs week on week.

Baker Hughes’ January 3 rig count revealed that North America dropped one rig week on week and its December 27 rig count showed that North America dropped 71 rigs week on week.

Baker Hughes, which has issued rotary rig counts since 1944, describes the figures as an important business barometer for the drilling industry and its suppliers. The company notes that working rig location information is provided in part by Enverus.

To contact the author, email andreas.exarheas@rigzone.com