The boom in U.S. oil production will live to see another week.
The nation’s crude explorers, engaged in a pricing war with the world’s largest suppliers, defied predictions of a drilling slowdown and ran the most rigs since mid-November, boosting the U.S. count by three to 1,575, Baker Hughes Inc. said on its website today. Rigs drilling for natural gas were unchanged at 344, the Houston-based field services company’s website showed.
The number of U.S. oil rigs has fallen from the 2014 peak of 1,609 amid a global surplus of crude that has dragged prices down by more than $45 a barrel and threatens to slow the nation’s unprecedented shale boom. OPEC decided last week to maintain production, placing more strain on U.S. oil producers that have some of the world’s highest drilling costs.
“There’s just so much momentum built up in the system right now and a lot of projects have already been funded,” Kurt Hallead, co-head of RBC Capital Markets’ global energy research team, said by telephone from Austin, Texas. “There are some projects that will continue on into the next quarter. Right now, you’re seeing the smoke, and you won’t really see the fire until about the second quarter.”Read more