(Adds natural gas price reaction in paragraph 2, rig counts in
Haynesville and Eagle Ford basins in paragraphs 8-9)
By Scott DiSavino
May 12 (Reuters) - The U.S. oil and natural gas rig
count fell this week to its lowest in nearly a year, as gas rigs
slumped by the most in a week since February 2016, energy
services firm Baker Hughes Co said in its closely
followed report on Friday.
U.S. natural gas futures jumped over 5% shortly after
Baker Hughes issued the report on expectations the rig count
reduction would cut output later this year. The oil and gas rig count, an early indicator of future
output, fell by 17 to 731 in the week to May 12, the lowest
since June 2022. The weekly drop was the biggest since June
2020. Baker Hughes said that leaves the total rig count up by just
17, or 2%, over this time last year. At the end of 2022, the rig
count was 193 rigs over the prior year.
U.S. oil rigs fell by two to 586 this week, their lowest
since June 2022, while gas rigs plunged by 16 to 141, their
lowest April last year.
U.S. oil futures were down about 13% so far this year
after gaining about 7% in 2022. U.S. gas futures ,
meanwhile, have plunged about 49% so far this year after rising
about 20% last year.
The drop in gas prices has already caused some exploration
and production companies, including Chesapeake Energy Corp , Southwestern Energy Co and Comstock Resources
Inc , to announce plans to reduce production by cutting
some gas rigs - especially in the Haynesville shale in Arkansas,
Louisiana and Texas.
The number of rigs active in the Haynesville, the nation's
third biggest shale gas field, fell by five this week to 57, its
lowest since February 2022, according to Baker Hughes.
The rig count in the Eagle Ford shale in South Texas,
meanwhile, dropped by two this week to 62, its lowest since May
2022.
Despite some plans to lower rig counts, U.S. crude
production was still on track to rise from 11.9 million barrels
per day (bpd) in 2022 to a new record high of 12.5 million bpd
in 2023 and 12.7 million bpd in 2024, according to projections
from the U.S. Energy Information Administration (EIA) in May.
The last record output was hit in 2019 at 12.3 million bpd.
U.S. gas production, meanwhile, was on track to rise from a
record 98.13 billion cubic feet per day (bcfd) in 2022 to 101.09
bcfd in 2023 and 101.24 bcfd in 2024, according to EIA's
projection.
(Reporting by Scott DiSavino
Editing by Marguerita Choy)
Messaging: scott.disavino.thomsonreuters.com@reuters.net))
For U.S./Canada natural gas rig count vs Henry Hub futures price, see: U.S. natural gas inventories: For a list of all Baker Hughes rig counts around the world, see: For U.S. oil rigs, see: For U.S. gas rigs, see: ))
