Energy Prices Steady – Rig Count Rises
December 16, 2016 ~ Energy Update
Oil rose on Friday, edging closer to new 17-month highs as producers showed signs of adhering to a global deal to reduce production. Those deals reached over the past two weeks have boosted expectations in the market that a two-year oil supply overhang will clear soon as prices remain near highs last seen in July 2015.
The prospect of lower production led U.S. bank Goldman Sachs to raise its WTI price forecast to $57.50 per barrel from $55 per barrel previously for the second quarter of 2017. For Brent, Goldman expects prices between $55 and $60 per barrel after the first half of 2017.
The Trump Presidency has been decidedly open about its energy policy and is clearly pro-oil and gas. This week Bill Gates spoke with the President-elect on benefits that clean energy can bring. Gates included an energy policy on a short list of topics during an initial phone call with Trump. That said, Gates thinks it is too soon to tell if the message got through. “It wasn’t a long enough call to get a clear sense,” Gates said.
Gates announced on Monday the start of Breakthrough Energy Ventures, a $1 billion clean energy fund, which he plans to chair. Other backers include Alibaba’s Jack Ma and Amazon’s Jeff Bezos. The fund aims to invest in next-generation energy technologies.
In a CNBC “Squawk Box” interview, Gates said the idea of the fund started a year ago when he was attending the global climate talks. He wants to make clean energy cheaper than “dirty” energy.
Rig Count Summary – Source: Baker Hughes
Last week, the number of oil and gas rigs in operation jumped by 27, with oil rigs accounting for 21 of the 27. The number of oil and gas rigs in U.S. fields rose again this week, up 13 — the fifth week in a row of increased counts and 69 rigs up over the past month.
- Texas gained 14 rigs, New Mexico gained two and Colorado added one.
- Oklahoma and Wyoming each declined by two, and North Dakota lost one.
- Alaska, Arkansas, California, Kansas, Louisiana, Ohio, Pennsylvania, Utah and West Virginia were unchanged.
When it comes to basins, there is no basin hotter right now than the Permian. Since September 23rd, the Permian Basin has added 57 oil rigs—a figure that represents more new oil rigs than all the other basins combined.
OKLAHOMA NEWS – Rig Count Slides Two More
After losing one rig last week, Oklahoma slides down two more rigs to rest at 78, down 10 from the high of 88, set back on January 29th. There is one directional, 75 HZ and 2 vertical rigs drilling.
Week over week, Canadian County lost 3 HZ rigs, while Dewey, Ellis, Hughes and Woods lost one rig each. Woodward County lost two.
The counties posting gains in the HZ category are Blaine that added two, Kingfisher is out on top with a total of 18 now after adding three and Major and Roger Mills Counties each gained one.
Compiled and Published by GIB KNIGHT
Gib Knight is a private oil and gas investor and consultant, providing clients advanced analytics and building innovative visual business intelligence solutions to visualize the results, across a broad spectrum of regulatory filings and production data in Oklahoma and Texas. He is the founder of OklahomaMinerals.com, an online resource designed for mineral owners in Oklahoma. ☞Email: [email protected]