Oil Jumps To Near $50 As U.S. Adds Another 8 Rigs

The U.S. rig count gain continued last week, as did Canada's seasonal decline, while the price of oil jumped more than $1.50 Monday morning upon news of Russia and Saudi Arabia backing a production supply cut.

Last week the U.S. added eight rigs exploring for oil and gas, continuing its long-standing gain, while the price of oil made a steady climb before jumping more than $1.50 Monday morning.

Friday's combined oil and gas rig count provided by oilfield services provider Baker Hughes showed that the current U.S. mark is now at 885 β€” up 118.0 percent year-over-year and up 118.5 percent since bottoming out at 404 in May 2016. The count equals its highest mark since Aug. 21, 2015.

Last week was the 17th straight week the combined U.S. rig count increased. Oil rigs comprised 80.5 percent of the total.

The U.S. added nine oil rigs last week, pushing its current mark to 712. It's that count's highest mark since April 24, 2015. It was the 17th straight week the oil rig count has grown, and the 27th week in the past 28. The 712 figure is up 123.9 percent year-over-year and up 125.3 percent since bottoming out at 316 in May 2016.

The current oil rig total is still less than half the 1,600 mark it checked in at on Oct. 10, 2014, but has grown steadily for 12 months.

The U.S. lost one gas rig last week β€” snapping a three-week gain streak. The active gas rig count of 172 is up 97.7 percent year-over-year, up 112.3 percent since bottoming out at 81.

The U.S. also has one rig labeled miscellaneous β€” the same as the week before.

Texas once again led last week's overall U.S. rig count gain, adding eight to a current total of 451 β€” up 149.2 percent year-over-year. Colorado, North Dakota, Ohio and Wyoming each added one, Alaska and New Mexico each lost one, while Oklahoma lost a pair.

Canada/North America

Canada's rig count continued to decline last week, losing another two overall to a count of 80. It was Canada's 11th straight week of decline, with its count decreasing by 258 β€” or 76.5 percent β€” in that time. However, those declines have slowed sharply in the past two weeks.

It should be noted that Canada's recent rig count decline is seasonal, corresponding closely with April-June declines of the past two years. In 2016, the count read 250 on Jan. 22 and then bottomed out at 36 on May 6 before climbing back to a peak of 352 by Feb. 10, 2017. Canada's 2015 count peaked at 440 in January, fell to 72 that May and returned to 215 by that August.

Friday's count of 80 is still up by 86.0 percent year-over-year, though that percentage has dropped sharply over these past 11 weeks. Canada added two oil rigs last week and lost four gas rigs. Currently, Canada's 29 oil rigs are up 13 year-over-year, and its 51 gas rigs are up by 25.

Friday's North American rig count of 965 if up by six from a week earlier. It is up 516 year-over-year β€” 114.9 percent.

Oil Price Update

After declining for three straight weeks, WTI Crude oil prices recovered throughout last week. Oil opened May 8 at $46.35, fell as low as $45.53 a day later before climbing to $47.84 by the close of Friday. Oil jumped more than $1.50 Monday morning upon news of Russia and Saudi Arabia backing a production supply cut, opening the day at $49.66. Oil was at $49.29 as of 9 a.m. CT Monday morning.

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