US rig count plunges to less than one-third what it was a year ago

Fuel Fix:

The number of operating U.S. oil and gas rigs plunged again this week in its twelfth week of losses, according to Baker Hughes.

The total number of operating rigs fell by 17 to 301. The lowest number during the most recent oil bust in 2014-16 was 404 in May 2016, and until this collapse was the lowest number ever recorded.

The number of rigs in operation, a leading indicator of oil and gas production activity in the U.S., has plunged by more than 50 percent since mid-March and two-thirds from a year ago, when 984 rigs were drilling in U.S. oil fields. The losses reflect an oil price bust that began in January as the spread of the coronavirus across the globe and an oil price war sent crude prices into a slump and the subsequent stay-at-home orders in the spring that sent prices diving.

Oil was trading at $33.64 a barrel in New York around 12:30 p.m. Central, about half its price at the beginning of this year.
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The good news is that oil is trading at over 33 times higher than it was a few weeks ago, when producers were actually having to pay people to take it because of storage shortages.  The grim rig count is also a reflection of heavy layoffs that have hit the energy industry.  It is a job problem that is likely to cascade through the economy of producing states like Texas.