As we are about midway through the first quarter of 2017, we wanted to provide you with the takeaways from the energy industry so far this year:
Baker Hughes Rig Count
According to Baker Hughes' announcement of the rig count for January 2017 – rig counts are up:
- The international rig count for January 2017 was 933, up 4 from the 929 counted in December 2016, and down 112 from the 1,045 counted in January 2016.
- The average U.S. rig count for January 2017 was 683, up 49 from the 634 counted in December 2016, and up 29 from the 654 counted in January 2016.
Oil Prices – Increased due to OPEC Production Cuts
According to CNN Money's article entitled, "Oil Prices have Doubled in a Year. Here's Why," "the market has mounted a stunning turnaround, with crude prices doubling to trade at $53.50 per barrel."
The cause? Compliance with OPEC production cuts is credited as a BIG factor.
According to Nasdaq article from Investing.com entitled, "OPEC Compliance on Production Cuts at 93%, oil pares losses":
- Recently, an OPEC monthly report showed a registered 93% compliance in their agreement to reduce production.
- The report (citing secondary sources) revealed that oil production decreased by 890,200 barrels per day to average 32.14 million barrels per day.
Current Oil Prices Are Actually Down a Bit
As I write this post, according to Bloomberg Energy, prices are down a little bit:
- WTI Crude Oil Price: $52.82
- Brent Crude Oil Price: $55.50
In fact, Yahoo Finance reports in its article entitled, "Oil Prices Head Lower In Spite of Bullish OPEC Data," that "oil is charging lower to start the week."
How do industry folks feel so far this year?
In my view, people in the industry remain optimistic as to the future of the energy industry. Some are skeptical as to whether oil prices will hold as the domestic rig count increases and as more wells that had been previously drilled but not completed have production that comes online. Many seem to feel calmer than they did this time last year. Overall though, industry people have recognized how technologies have refined and how operations have become more efficient in recent years and they are looking forward to the future of the oil and gas industry.
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