Very strong activity, with ten new horizontal oil rigs added during the week despite an increase of only three rigs in the total count. Crude oil (NYSE: USO) continued to trade in the same narrow range it has traded since the beginning of the year and closed about $0.30/bbl above the previous Friday.
Source: Baker Hughes
* Total U.S. rig count (oil + gas) increased by 3, although horizontal rigs increased by 10.
* The total oil rig count increased by 5. In total, oil rigs are up by 90.5% since the bottom in late May 2016. Virtually all of the rigs added have been horizontal.
* Horizontal rigs increased by 10 despite total rigs increasing by only 3. This means 7 directional or vertical rigs were replaced by horizontal rigs. In total, we believe the 10 horizontal rigs added during the week are oil rigs.
The horizontal rig count is up by 99% since the bottom in late May 2016. Most of these rigs have been oil rigs.
*Source: Baker Hughes, Orangutan Capital
Strong activity in the Eagle Ford basin, as well as the usual number of new rigs in the Permian.
* The Permian oil rig count increased by 3. In total, the rig count in the Permian is up by 132% since the bottom in late April / early May 2016. Virtually all of the rigs added have been horizontal.
* The Eagle Ford basin, which has seen a lot of activity so far during 2017, added four new rigs during the week.
* Cana Woodford, which has also seen a lot of activity during the year, added two new rigs.
* The natural gas rig count decreased by 2, mostly in minor basins, with one new rig in the Haynesville basin and Marcellus, Utica and the Barnett shale staying flat for the week.
Another week, another round of solid rig count increase with several rigs added both in the Permian as well as outside of it. With crude oil and products storage numbers soaring so far during the year, oil producers should better be hedging their output going forward.
We see a lot more increases coming in the following months as financing is currently available for development both inside and outside of the Permian.
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