US Oil Rigs Dive to Lowest

US Oil Rigs Dive to LowestUS Oil Rigs Dive to Lowest

US oil drillers began the year by slashing the number of rigs to the lowest in over five years, data showed on Friday, with analysts saying further reductions are almost certain as producers respond to a deepening oil price rout. Drillers cut 20 oil rigs in the week ended Jan. 8, the third-largest one-week decline since May, oil services company Baker Hughes Inc. said in its closely followed report, Reuters reported. The reductions occurred across every major shale patch, from the Permian to the Bakken. The remaining 516 rigs were the fewest since April 2010, according to the data, but few expect the slump to end there. Oil prices have dropped more than $10 a barrel over the past two months, about half of that in the past week. Lower prices are likely to be reflected in more idled rigs over the coming month or two. Over the prior five years (2010-14), producers added on average 216 oil rigs per year. In 2015, however, they cut on average 18 oil rigs per week.