U.S. Rig Count Posts 2nd-Straight Slide As OPEC Deal Spikes Oil Price

After 10 straight weeks of gains, the active U.S. rig count has posted back-to-back declines. Meanwhile, the price of oil soared nearly $4 Friday upon news of OPEC agreeing to increase its output.

The U.S. combined oil and gas rig count — which had added 69 rigs in its 10-week gain streak — lost seven rigs this past week after losing three the week before and registered a mark of 1,052 on Friday. That mark is up 111 year-over-year (YoY), or 11.8 percent. Data from oilfield services provider Baker Hughes shows the U.S. lost one oil rig and six four gas rigs, with its oil rig count of 862 now up 104 YoY (+3.7 percent) and its gas rig count of 188 up five YoY (+2.7 percent). The U.S. miscellaneous rig count remained at two.

Year-to-date, the U.S. combined rig count is up 123 through 25 weeks of 2018, which has included 18 weekly gains, six decreases and one hold.

Of last week's combined rig count, Alaska added two and Wyoming added one. Louisiana lost four and Oklahoma lost a pair, while Colorado, North Dakota, Pennsylvania and Texas each lost one.

Below is the daily U.S. rig count provided by Drillinginfo on its DailyRigcount.com — a microsite that utilizes data from GPS tracking units and publicly-reported information to monitor oil and gas drilling rig movements in the U.S. Unlike traditional rig counts — such as those from Baker Hughes — typically define a rig as active only when it is "turning to the right," and have been released on Friday afternoons every week since 1944, whereas DailyRigCount defines a rig as active from the time a GPS tracking unit identifies it at a permitted oil and gas drilling location until the time it leaves, and is released daily.

Canada/North America

After bottoming out at 79 on May 11, Canada's seasonal rig count increase continued in earnest this past week. Canada gained 21 rigs, following gains of 27, 13 and 18 the previous three weeks, respectively. Its count rose to 160 on Friday, still down 10 YoY (-5.9 percent). Canada added 16 oil rigs and five gas rigs, with its 103 oil rigs up by five YoY and its 57 gas rigs down by 15.

Friday's North American combined rig count of 1,212 increased by 14 from a week earlier and was up by 101 YoY, or 9.1 percent.

Oil Price Update

The countries of the OPEC oil cartel announced Friday morning that they agreed to increase their combined production by almost 1 million barrels per day, which set WTI Crude oil prices soaring back to near $70 after hovering near $65 for most of the week. Oil opened Monday, June 18 at $63.85 and held a fairly narrow range through Wednesday, from $64.41 to $66.04. Oil picked up steam Thursday night, climbing to $66.50. Upon the OPEC news, oil spiked from $66.30 at 6 a.m. CT to $67.63 within 2 hours, and continued to climb to $69.33 by the late afternoon. Oil closed the workweek Friday at $69.22 and dipped a bit over the weekend before opening Monday at $68.44. Oil was at $68.91 as of 8 a.m. CT.

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