US Gas & Oil Rigs Over 1000 Rigs Lower than Last Year

According to Baker Hughes data from June 26, 2015, the U.S rig count for the week was 859 rigs exploring for or developing oil or natural gas. This is up 2 rigs when compared to last week, with oil rigs down 3 to 628 rigs, gas rigs up 5 to 228 rigs, and miscellaneous rigs unchanged at 3 rigs. Compared to this time last year, the 859 count is down 1014 rigs, with oil rigs down 930, gas rigs down 86, and miscellaneous rigs up 2.

The decline in the drilling of new gas and oil wells is having a direct impact on the amount of line pipe, storage tanks, and OCTG that is being used by the energy sector. A good portion of these products come from hot rolled coil or plate substrate, and are reasons for both the short lead times on hot rolled and plate at North American steel producers and the falling steel prices we had seen going back to mid-2014. Prices have since stabilized for hot rolled coil but the product is having a difficult time breaking out of a very narrow trading range partially due to the weakness in the energy sector.

Brett Linton

Brett Linton is a digital operations analyst for Steel Market Update, where he began his career. Linton has been in the steel industry since 2010. He has held roles as a category manager and strategic insights director at Reibus before returning to SMU in 2024. He is a graduate of The University of North Georgia with a degree in Finance and Accounting. Brett can be reached at brett@steelmarketupdate.com or 724-314-0179.