Baker Hughes reports that US drillers have added oil and gas rigs to their fleet for the first time in 4 weeks.
Baker Hughes, a leading energy services company, said that the U.S. added oil and gas rigs this week for the first time since four weeks.
The number of oil and gas rigs, a good indicator of future production, increased by two in the week ending April 17 to 585.
Baker Hughes reported that despite this week's increase in rigs the total count is still 34 rigs or 5% lower than this time last year.
Baker Hughes reported that oil rigs increased by one this week to 481 while gas rigs increased by one to 98.
Oil and gas rig counts are expected to decline by 5% and 20% respectively in 2024, as the lower U.S. gas and oil prices in recent years have prompted energy companies to concentrate more on increasing shareholder returns and paying off debt than increasing production.
The U.S. Energy Information Administration, however, projected that crude production would increase from a record 13,2 million barrels per daily (bpd), in 2024, to approximately 13.5 million in 2025.
The increase in U.S. oil production was, however, lower than the EIA's forecast in March, due to lower oil prices as U.S. president Donald Trump's new tariffs are likely to lead to a weaker global economy and oil demand.
EIA's Annual Forecast
This week's data also revealed that the nearly 2-decade-old shale oil boom, which made the U.S. the world's biggest oil producer, is nearing its end. Trump's plan to increase domestic oil production has been challenged.
The EIA predicted that U.S. oil production will reach a peak of 14 million barrels per day in 2027, and then rapidly decline. The EIA said that shale production would peak at 10,000,000 bpd, an increase from 9.7,000,000 bpd last year. It will then drop to 9.3,000,000 bpd by the year 2050. Reporting by Scott DiSavino Editing By Marguerita Choy
(source: Reuters)
