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    US Gas & Oil Rigs Stop Dropping (at least for one week)

    Written by Brett Linton


    According to Baker Hughes data from July 10, 2015, the U.S rig count for the week was 863 rigs exploring for or developing oil or natural gas. This is up 1 rig when compared to last week, with oil rigs up 5 to 645 rigs, gas rigs down 2 to 217 rigs, and miscellaneous rigs down 2 to 1 rig. Compared to this time last year, the 863 count is down 1,012 rigs, with oil rigs down 918, gas rigs down 94, and miscellaneous rigs unchanged.

    The decline in the drilling of new gas and oil wells is having a direct impact on the amount of line pipe, storage tanks, and OCTG that is being used by the energy sector. A good portion of these products come from hot rolled coil or plate substrate, and are reasons for both the short lead times on hot rolled and plate at North American steel producers and the falling steel prices we had seen going back to mid-2014. Prices have since stabilized for hot rolled coil but the product is having a difficult time breaking out of a very narrow trading range partially due to the weakness in the energy sector.

    Brett Linton

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