23rd January 2015
GCA’s U.S. Oil & Gas Monitor continues down on trend with the 2008-2009 decline, down a further 2 index points this week. Based on the Baker Hughes rig count, there was a fall of 43 in the U.S. onshore rig count, with this now having declined by 297 from a year high of 1,876 in November 2014 to 1,579 on 23 January 2015.
- 16 Jan 2015 - Largest U.S. Onshore Rig Count Fall for 6 Years
- 9 Jan 2015 - New Year Experiences Large Fall in U.S. Onshore Rig Count
The GCA Indices for rig count and oil price are a comparison of today’s data with the average in the three month period April to June 2014. Changes this past week place the GCA Index for U.S. onshore rigs at 88, 16 points down on the 2014 high and 2 points down on the previous week. The GCA Index for the Brent oil price dropped two points to 44, with the price having bounced around in the US$ 48/Bbl to US$ 50/Bbl range for most of the week.
The rig count and indices for the GOM remained flat overall with a decline of 1 (2 index points) in the oil rig count.
The trend can be seen clearly if oil price and rig count indices from 1 July 2008 to 31 December 2009 are plotted on the same scale range as the current oil price and rig count indices. The current oil price fall has been slightly shallower than in 2008, and although it appears to have marked time over the past two weeks, it is by no means clear it has reached bottom. The rig count index has started to track down that seen in 2008-2009, similarly displaced 5-6 months from the decline in oil price.
Looking more specifically at the major onshore basins where unconventional (tight and shale) oil are being developed (Permian, Eagle Ford and Williston Basin) which together represent 60% of the oil-targeted activity, the drop has been even more marked than overall change, being on average 15 to 25 points off 2014 highs.
The rig count in these basins is down 25 in the week, with the GCA Indices now ranging from 81 (Eagle Ford) to 88 (Permian). However, the Williston basin suffered the largest decline this week, with another 13 rigs being cut. The GCA Index for all three basins combined is 85, a drop of 3 points in the week.
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