U.S. rig count falls after 17 weeks

Baku. 31 October. REPORT.AZ/ The total active U.S. rig count, which includes oil and natural-gas rigs, climbed by 4 to 557, Baker Hughes said. 

Report informs referring to the Baker Hughes the count was propped up by an addition of 6 national gas rigs in the U.S., bringing the count to 114. But two oil rigs were taken offline this week, bringing the count down to 441 overall and marking the first time it has fallen since June.

The news comes as concerns continue to swirl as to whether the Organization of Petroleum Exporting Countries, or OPEC, will finally agree to some form of a production freeze as the world continues to face record oversupply of crude. West Texas Intermediate crude oil contracts for December delivery finished down 2% at 48.70 USD on Friday following reports that OPEC leaders meeting in Vienna were deadlocked on a details of a deal.

Baker Hughes' U.S. rig count is down 218 rigs from last year's count of 775, with oil rigs down 137, gas rigs down 83, and miscellaneous rigs up 2.

The offshore rig count, meanwhile, continues to tread water, with one rig coming offline, bringing the count down to 22.

Notably, the number of oil wells in operation in the United States was 316 as of May 25, 2016, that is the minimum limit of the last 7 years. Currently, the number of active oil wells is by 39.6% more than the minimum limit. The figure reached a record level in October 2014 and amounted to 1 609 units. Currently, the number of wells is lower by 72.6% than the record number of wells. Notably, after 17 weeks of consecutive increase, the number of oil wells in operation showed a decrease in the last week.

Analytical Group of Report News Agency believes, US power engineers suspended work of some drilling wells in the last reporting week due to the preventive work. In addition, their attention paid to the OPEC summit on November 30 in Vienna. The reason for not increasing number of wells in the oil market is that the positive results not expected from Vienna summit.

Bloomberg Intelligence's Andrew Cosgrove said except fromPermian Basin oil production not expected to increase. Thus, the number of wells drilled in the basin in the last reporting week has not changed and made 212. In other basins to price will withstand at 50-60 USD / barrel and oil production not expected to rise.