Page 12 - FSUOGM Week 20

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attract interest as the likely forerunner of other major decisions.
Flashpoints involving Iran and the US, and the Gulf of Aden, feature, as do the woes of the iconic American University of Beirut, for so long a beacon of sanity and hope in this troubled region.
If you’d like to read more about the key events shaping the Middle East’s oil and gas sector then please click here for NewsBase’s MEOG Monitor.
Historic lows for North American rigs
The active US oil and gas rig count has fallen to an all-time low for the second consecutive week. In the week up to May 15, the total rig count dropped by 35 to 339, according to the latest data from oilfield services firm Baker Hughes. This comes after active US rigs had decreased to a previous all-time low of 374 the previous week.
The previous record-low was 404 rigs, recorded in May 2016 during the last industry downturn. Records of rig counts begin in the 1940s.
The collapse has been rapid, with the US rig count standing at 987 a year ago, declining some- what to 796 at the start of 2020 and remaining relatively steady until mid-March, when it was still at 792. The oil rig count stands at 258 as of
May 15, having slumped from 683 on March 13. The gas rig count has shown a much more modest decline from 107 to 79 over that period, illustrating the toll on oil-focused producers in particular.
Rig counts in Canada have also fallen to a record low, dropping to 23 in the week up to May 15. The oil rig count has stood at just seven for three consecutive weeks, and has been in single figures since the start of April. It is worth noting that rig counts typically drop in Canada in the spring as snow melts, forcing a lot of activity to stop. Nonetheless, the severity of this downturn has exacerbated the situation. For comparison, during the last downturn the lowest Canadian rig count was 36, recorded in May 2016.
There is concern that the bottom of the market has not yet been reached, and more rig cuts will follow. However, in better news for the industry, West Texas Intermediate (WTI) did not go negative again ahead of the June contract expiring on May 19. The benchmark instead closed at $32.50 per barrel. This was attributed to output cuts and early signs of a gradual recovery in demand for fuel.
If you’d like to read more about the key events shaping the North American oil and gas sector then please click here for NewsBase’s NorthAmOil Monitor. ™
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w w w . N E W S B A S E . c o m Week 20 20•May•2020