COLUMN-California oil drillers hit hard by tumbling prices: Kemp
(John Kemp is a Reuters market analyst. The views expressed are his own)
By John Kemp
LONDON Jan 14 (Reuters) - California's oil industry is being hit harder than any other state by falling prices because of the comparatively poor quality of its crude and its aging fields.
The number of active drilling rigs in the state has more than halved since June 2014, from 48 to just 21, according to oilfield services company Baker Hughes (link.reuters.com/ruz73w).
The California rig count is the lowest since October 2009, when producers were struggling with low prices in the aftermath of the global financial crisis and deep recession that began a year earlier.
California's high-cost and low-productivity oil industry has always been vulnerable to falling prices and exhibits deep especially cycles in activity rates.
It is still the third-largest oil producing state in the union, producing almost 560,000 barrels per day, according to the U.S. Energy Information Administration.
Oil fields in the Los Angeles Basin and around Bakersfield in Kern County were once among the largest and most productive in the United States.
But the state's output has been steadily declining since 1986. Unlike other major producing states such as Texas, North Dakota and Oklahoma, the shale revolution has bypassed the state. Continued...