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2-Year Decline in Global Oil Rigs

2-Year Decline in Global Oil Rigs2-Year Decline in Global Oil Rigs

The number of rigs targeting oil outside North America fell by 36% to 677 in the two years to June 2016, continuing to slide after a brief uptick in May, data from service company Baker Hughes showed Friday.

Latin America and to a lesser extent Africa have led the fall in rig numbers during the last two years of oil price weakness, the data confirmed, with the count for Latin American rigs targeted at oil less than half what it was two years earlier, at 151, Platts reported.

In Brazil, the number of rigs targeting oil has fallen from 43 to 13 since June 2014, while in Argentina, where the industry is mainly onshore, the number has fallen from 88 to 56, and in Colombia from 43 to seven.

In Africa, the number of rigs targeted at oil has fallen from 95 to 58 over the two years, with reductions in Nigeria, Libya, Gabon and Angola. However, the reduction for the first six months of this year, at 11%, is less steep than for the corresponding six months in 2015, when oil rig numbers fell 30%.

Rig numbers have also fallen in the Middle East, with 284 targeted at oil across the region in June 2016 compared with 339 two years earlier. However, the reduction is mainly accounted for by Iraq, where the number of oil rigs fell from 96 to 41.

By contrast, Abu Dhabi has increased its oil rig count from 30 to 42 over the period, Kuwait from 27 to 35 and Oman from 50 to 55, with Saudi Arabia virtually unchanged at 66.

Baker Hughes does not provide numbers for Iran or Russia.

Oil rig numbers for Norway and the UK remained virtually unchanged over the two-year period, although a slight uptick in Norway in 2015 has since subsided, which had 16 in June.

Financialtribune.com