May 19, 2025
As the U.S. oil and gas sector continues to navigate price volatility and capital discipline, the latest Baker Hughes rig count highlights a steady decline in drilling activity — even as production forecasts remain bullish. Operators are leaning on efficiency gains and strategic capital deployment to sustain output with fewer rigs. Here’s a snapshot of the current landscape, key state-by-state trends, and what it means for 2025.
U.S. Rig Count Drops Again — But Production Still Forecast to Rise
For the week ending May 16:
- U.S. total rig count: ↓ 2 to 576 — the lowest since January
- Oil rigs: ↓ 1 to 473 (lowest since Jan)
- Gas rigs: ↓ 1 to 100
- Misc rigs: unchanged at 3
- Offshore rigs: stable at 11
- YoY decline: ↓ 28 rigs (5%) vs. May 2024
Key basin trends:
- Permian: ↓ 3 to 282 — lowest since Nov 2021
- New Mexico: ↓ 2 to 94 — lowest since Feb 2022
- Oklahoma: flat at 55 rigs (↑ from 44 a year ago)
- Texas: ↓ 2 to 271
- Kansas: ↑ 3 to 23 (Red Top Rig Report)
- Ohio: ↑ 1 to 10
- Wyoming: ↑ 1 to 20
(Most other states flat)
💸 Capex & Market Sentiment:
- E&Ps to cut 2025 capital spending by ~3% (TD Cowen)
- 2023 capex was up 27%, but 2024 is flat
- Rig activity down due to prioritizing debt reduction and shareholder returns
📈 Despite fewer rigs, output climbs:
- Crude production: EIA projects rise from 13.2M bpd in 2024 to 13.4M bpd in 2025
- Gas production: Expected to increase to 104.9 bcfd in 2025
- Driven by rebound in gas prices (+88% forecast for 2025) after a 14% drop in 2024
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