The price of WTI crude oil was little changed at around $58.50 per barrel on Friday, after Baker Hughes A GE Co (NYSE: BHGE) released its weekly U.S. rotary drill rig numbers. Rig counts have been slowly creeping higher for nearly three years now as the oil market recovers from a 2014 price collapse.
Baker Hughes announced 1,026 active U.S. rigs on Friday, down 1 rig from last week’s count. The current rig count is near its highest level since early 2015.
The updated count represents a year-over-year increase of 36 rigs. Out of the 1,026 active rigs, 833 are drilling primarily for oil and 193 drill primarily for gas. There are 33 more active oil-drilling rigs year-over-year and 4 more gas-drilling rigs.
Oil Prices React
Oil investors typically see rig shutdowns as a positive for the price of crude, as the oil market is still struggling to reach a balance following after a oil glut caused prices to collapse in 2014.
OPEC announced in December that it intends to cut production by 1.2 million barrels per day in early 2019 to help curb global supply. This week, OPEC said it expects global oil demand to be 99.96 million barrels per day in 2019. Global supply in February was 99.15 million bpd, according to OPEC.
While OPEC is dialing back production, the U.S. is expected to ramp it up this year. The U.S. Energy Information Administration says the U.S. will produce a record 12.4 million bpd of oil in 2019 and up that to 13.2 million bpd in 2020.
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