2023-09-22 17:04:46
September 22 – U.S. energy companies this week reduced the number of oil and natural gas drilling rigs for the first time in three weeks, energy services company Baker Hughes said in its very recent report. followed by Friday.
The number of oil and gas installations, an early indicator of future production, fell by 11 to 630 during the week of September 22, the lowest since February 2022.
U.S. oil rigs fell by eight to 507 this week, their lowest level since February 2022, while gas rigs fell by three to 118.
U.S. oil futures are up regarding 12% year to date, following gaining regarding 7% in 2022. U.S. gas futures, meanwhile, have plunged regarding 41% year-to-date, following increasing regarding 20% last year.
Even though energy companies are on track to increase spending for the third straight year in 2023 – mainly to cover rising inflation-related costs for labor and equipment – many companies are still more focused on returning money to investors and paying down debt rather than increasing oil and gas production.
Independent exploration and production companies tracked by U.S. financial services firm TD Cowen plan to increase spending by regarding 19% in 2023, following a rise of regarding 40% in 2022 and a modest 4% increase. in 2021.
Rising oil prices allowed US crude production to increase from 11.9 million barrels per day (bpd) in 2022 to 12.8 million bpd in 2023 and 13.2 million bpd in 2024, according to projections from the Energy Information Administration (EIA). This figure compares to the record of 12.3 million bpd reached in 2019.
Oil production in major shale-producing regions, however, is expected to fall for the third consecutive month in October and reach its lowest level since May, according to the EIA.
Despite falling gas prices, U.S. gas production is expected to increase from a record 98.1 billion cubic feet per day (bcfd) in 2022 to 102.7 bcfd in 2023 and 104.9 bcfd in 2024, according to EIA projections in September.
This increase in gas production despite falling gas prices is primarily due to increased interest in oil drilling in shale basins that also produce a lot of associated gas, such as the Permian in West Texas and the Eastern New Mexico. (Reporting by Scott DiSavino; Editing by Marguerita Choy)
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