U.S. oil drillers cut rigs for 6th week to Nov 2009 lows -Baker Hughes

Fri Apr 29, 2016 1:03pm EDT
 
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April 29 (Reuters) - U.S. energy firms cut oil rigs for a
sixth week in a row to the lowest level since November 2009, oil
services company Baker Hughes Inc said Friday, as
drillers remained cautious in returning to the well pad despite
crude futures climbing to their highest levels this year.
    Drillers cut 11 oil rigs in the week to April 29, bringing
the total rig count down to 332, Baker Hughes said in its
closely followed report. RIG-OL-USA-BHI 
    The number of U.S. oil rigs currently operating compares
with the 679 rigs operating in the same week a year ago. 
    Energy firms have slashed spending by sharply reducing oil
and gas drilling since the collapse in crude markets began in
mid-2014. U.S. crude futures fell from over $107 a barrel
in June 2014 to a near 13-year low around $26 in February.
    U.S. crude futures, however, have spiked nearly 80 percent
in the past two months and hit 2016 highs of just under $46 on
Friday as market sentiment turned more upbeat despite the
persistent oversupply. 
    U.S. crude futures were above $47 a barrel for the balance
of 2016 and about $49 for calendar 2017. 
    Baker Hughes said at its quarterly earnings release on
Wednesday that it expected the U.S. rig count to start
stabilizing in the second half of the year, although it did not
expect any meaningful hike in oil drilling activity.
    Whiting Petroleum Corp's Chief Executive Jim Volkers
said the firm would like oil prices to stay at or above $50 for
at least 90 days before deciding to reduce
drilled-but-uncompleted well count in Colorado. 
    The world's No. 1 oilfield services provider Schlumberger NV
 also said it will remain cautious in adding capacity
even after energy firms show signs of recovery since it believes
the industry will continue cutting costs through the coming
quarter. 
    The rig count is one of several indicators of future oil and
gas production. Other indicators include drillers ability to get
more out of each well and the completion of drilled but
uncompleted wells.


    
 (Reporting by Barani Krishnan; Editing by Marguerita Choy)