Energy Rigs in U.S. Decline to 21-Month Low

From Bloomberg

By Lynn Doan & Richard Stubbe

Gas and oil rigs in the U.S. dropped for the sixth straight week to the lowest level since March 2011 as producers slowed exploration in shale formations that have pushed domestic crude output to a 19-year high.

Oil rigs fell by nine to 1,318 this week, data posted on Baker Hughes Inc. (BHI)’s website show. The gas count rose by eight to 439, the field-services company based in Houston said. Total energy rigs declined by one to 1,762.

The U.S. oil rig count dropped in the fourth quarter, the second quarterly decline after 13 advances, as energy producers scaled back drilling programs on high crude supplies and lower prices. The gas count has shrunk to less than a third of its peak in August 2008 as companies turned away from dry-gas plays to focus on more profitable gas liquids.

Crude for February delivery on the New York Mercantile Exchange fell 20 cents yesterday to settle at $92.92 a barrel, down 9.8 percent from a year ago.

U.S. oil output rose to the highest level since March 1993 last week. The surge helped the U.S. meet 83 percent of its energy needs in the first half of the year, on track to be the most since 1991. Stockpiles of the feedstock slipped 3 percent to 359.9 million barrels. Supplies reached a 22-year high of 387.3 million barrels in June.

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