January 20, 2025
The latest rig count data from Baker Hughes and Enverus paints a clear picture of a slowing U.S. drilling industry, with activity levels dipping to their lowest since December 2021. Over the past week, the national rig count fell by four, leaving 580 rigs active across the country—a decline of 40 rigs compared to this time last year.
This downturn reflects broader industry challenges, including lower oil and gas prices, cautious capital spending, and ongoing shifts in regional activity. Key areas like the Permian Basin remain steady, while others, such as North Dakota, have seen notable declines. This report provides a detailed look at the latest trends in drilling activity and regional dynamics, offering insights into the current state of the oil and gas sector.
Key Updates:
- National Rig Count:
- Total rigs: Down 4 to 580, the lowest level since December 2021.
- Year-over-year: 40 rigs fewer (-6%) than the 620 reported a year ago.
- Oil rigs: Decreased by 2 to 478, the lowest since November, and 19 fewer (-4%) than last year.
- Gas rigs: Dropped by 2 to 98, the lowest since September, and 22 fewer (-18%) than last year.
- Miscellaneous rigs: Steady at 4, up one from the previous year.
- Regional Insights:
- Texas: Lost 1 rig, totaling 281 (-8% YoY).
- New Mexico: Unchanged at 103 rigs, maintaining stability in the Permian Basin.
- North Dakota: Dropped 4 rigs, reaching 32 (-11% YoY).
- Wyoming: Added 1 rig, totaling 19.
- Permian Basin: Steady at 304 rigs, down 1% YoY.
- County-Level Highlights:
- Eddy County, NM: Most active with 53 rigs.
- Lea County, NM: Second most active with 47 rigs.
- Midland County, TX: Declined by 1 rig to 29.
- Reagan County, TX: Increased by 1 rig to 12.
- Permitting and Frac Activity:
- Permian Basin drilling permits: Down to 679 as of Dec. 27, a decrease from 751 the prior week and 702 YoY.
- Frac crews in the Permian: Declined to 96, from 108 the previous week and 118 YoY.
- Producer Activity:
- ExxonMobil: Leading with 35 rigs (-1 from last week).
- ConocoPhillips: Fell 2 rigs to 33.
- Occidental Petroleum: Steady at 30 rigs.
Broader Implications:
- The decrease in active rigs and permitting activity suggests continued caution in the face of market uncertainties and possible oversupply pressures.
- Regional stability in key areas like New Mexico contrasts with declines in states like Texas and North Dakota, reflecting a selective approach to capital deployment.
These trends underscore the challenges facing the oil and gas industry, including adapting to changing market dynamics, regulatory pressures, and a push toward optimizing operations for efficiency.
