Baker Hughes reported its weekly rig count on Thursday due to the shortened holiday trading week. Total rigs declined by 20 to 1028, but natural gas rigs declined by 11 to 222.
Natural gas rigs have now declined by 106 rigs, an astonishing 33%, since the start of 2015. The current number of rigs (222) is the lowest number of natural gas rigs since Baker Hughes first started reporting natural gas rigs in 1987.
“The pace of declining oil rig counts has slowed,” said Steve Kingston, a reporter for NatGasInvestor.com. “But natural gas rigs have continually dropped by 4-5% each week with no signs of a slowing decline.”
“While the efficiency of newer rigs can make up for production, it will be interesting to see how the lowest number of rigs in over 25 years can ultimately refill storage to meet summer and next year’s winter demand,” said Kingston.
Natural gas futures for April ’15 delivery traded 10 centers higher on Thursday at $2.711 as the U.S. Energy Administration reported a withdrawal from storage of -18 Bcf. Industry analysts were expecting a withdrawal of -11 Bcf.
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