The Baker Hughes North American rig count is down 1 in the April 28 week to 955. The U.S. rig count is up 13 to 870 rigs and is up 450 rigs from last year. The Canadian count is down 14 rigs from last week to 85, but compared to last year is up 48.
For the U.S. count, rigs classified as drilling for oil are up 9 to 697, gas rigs are up 4 to 171, and miscellaneous rigs are unchanged at 2. For the Canadian count, oil rigs are down 9 to 24 and gas rigs are down 5 to 61.
As in previous weeks in March and April a sharp drop in the Canadian count contrasts with a strong and steady rise in the U.S. count. Since March 3, the U.S. total count is up 114 rigs, while the Canadian total count is down 250. But while the U.S. count represents a market driven increase, the Canadian count is a seasonal phenomenon, dubbed the Spring Breakup, which reduces the Canadian rig count around the same time each year, usually between the beginning of March and the end of May. With only about one third of Canadian rigs drilling for oil, the impact of the Canadian count affects total gas exploration more than oil. Oil exploration is affected by the U.S. total count much more heavily, not only because of its much greater size, but also because 80 percent of this count represents oil rigs.
The trend seen from the Baker Hughes counts shows North American companies increasing investment in drilling activity over the last year, with the number of rigs more than doubling since a year ago. It points to significantly higher oil and gas production outputs in North America ahead, at least until a decline in oil and gas prices makes production uneconomical.