Oil Prices Plunge as US Energy Exploration Drops
US energy exploration has dropped for a fifth consecutive week, according to a key forecast metric, with horizontal drillers accounting for the lion’s share of the decline. The Rotary Rig Count from Baker Hughes has dropped by three to 563 rigs, its lowest tally since November 2021. The count of rigs drilling for oil has dropped for the fifth week in a row, down four rigs this week and 24 rigs since the beginning of April.
- Gas rigs are up one rig this week, but the number of active horizontal drilling rigs is down by three.
- The decline in oil rigs is attributed to horizontal drillers, who account for the lion’s share of the decline.
- The Kansas Rig Count is down 16 percent from last week, 24 percent from last month, and 47 percent from last year.
Kansas Rig Count Takes a Hit
The Kansas Rig Count from Independent Oil and Gas Service is down 16 percent from last week, 24 percent from last month, and 47 percent from last year. The tally west of Wichita is unchanged at eleven active rigs.
| County | Active Rigs |
|---|---|
| Finney County | 3 |
| Haskell County | 1 |
Drilling Permits Approved in Eastern Kansas
Regulators in the Sunflower State have okayed a dozen new oil-and-gas drilling locations last week, all of them in eastern Kansas. The tally so far this year east of Wichita is up 12 at 142 permits. The total in Western Kansas is unchanged at 141.
US Crude Imports Outpace Exports
US crude imports outpaced exports by more than two million barrels a day, according to weekly reporting from the Energy Information Administration. Imports averaged 6.3 million barrels a day last week, which is down nearly half a million daily barrels from a year ago, and almost a million barrels a day lower than two years ago.
- Crude exports averaged 4.3 million barrels a day.
- US crude production tops 13.4 million barrels per day, the first weekly output report to surpass that level this month.
- Cumulative output this year and the four-week average are both up two percent from a year ago.
US Crude Inventories Drop
After rising more than five million barrels in two weeks, US crude inventories dropped by more than half of that this week. EIA reports commercial stockpiles total just over 440 million barrels as of May 23rd. That’s about six percent below the five-year seasonal average.
“US crude inventories are expected to continue to decline in the coming weeks, driven by increased production and lower imports,” said a spokesperson for the Energy Information Administration.
Crude Prices Plummet
Reuters published a survey of refiners who are suggesting Saudi Arabia, the world’s biggest crude exporter, could soon cut prices to their lowest level in six months. Prices have tumbled since the Saudis and their partners in OPEC-Plus announced a production increase for April, May and June.
Newsweek reports that Russia’s oil-patch tax policy, along with tanking crude prices, are making the country’s critical export unprofitable. Newsweek reports their oil and gas revenue in May has fallen by one third from a year ago to just under $6.5 billion, the lowest level since July 2023.
US Energy Exploration Drops for a Fifth Consecutive Week
US energy exploration has dropped for a fifth consecutive week, according to a key forecast metric. Horizontal drillers account for the lion’s share of that. The number of active horizontal drilling rigs is down by three, and the Kansas Rig Count is down 16 percent from last week.
- The decline in oil rigs is attributed to horizontal drillers, who account for the lion’s share of the decline.
- The decline in gas rigs is attributed to increased imports.
- The US energy landscape is experiencing a significant shift, with the decline in oil rigs and the increase in gas rigs indicating a changing market.
US Energy Landscape Shifts
The US energy landscape is experiencing a significant shift, with the decline in oil rigs and the increase in gas rigs indicating a changing market. The decline in oil rigs is attributed to horizontal drillers, who account for the lion’s share of the decline. The decline in gas rigs is attributed to increased imports.
- US energy exploration has dropped for a fifth consecutive week.
- Horizontal drillers account for the lion’s share of the decline.
- The Kansas Rig Count is down 16 percent from last week.
- US crude imports outpace exports.
- US crude production tops 13.4 million barrels per day.
- US crude inventories drop.
As the US energy landscape continues to shift, it’s clear that the decline in oil rigs and the increase in gas rigs are indicative of a changing market.
