Baker Hughes: US Eagle Ford Basin Gains One Oil Rig This Week

Reuters

May 15 (Reuters) - U.S. oil drillers added a rig in the Eagle Ford basin for the first time since March, after weeks of idling rigs on slumping crude prices, industry data showed on Friday.

Energy companies increased by one to 87 the number of oil rigs in the Eagle Ford in South Texas, the nation's second biggest shale oil field, oil services company Baker Hughes Inc said in its closely followed report.

The Permian basin in western Texas and eastern New Mexico, meanwhile, lost three rigs this week, leaving 233 active rigs, after gaining one last week.

That is the lowest number of rigs in the Permian, the nation's biggest and fastest growing shale oil field, since at least 2011, according to Baker Hughes data going back to 2011.

Overall, the number of active oil rigs declined for the 23rd week in a row, but the rate of that decline has slowed in recent weeks, suggesting the drilling collapse may be coming to an end as prices recover after falling 60 percent from June to March.

The number of rigs drilling for oil fell by eight this week, the smallest drop since December, to 660, after declining 11 and 24 rigs in the prior two weeks.

With this week's oil rig decline, the number of active rigs has fallen to the fewest since August 2010, according to Baker Hughes data.

Since the number of oil rigs peaked at 1,609 in October, producers have slashed spending, eliminated thousands of jobs and idled more than half of the country's rigs in response to the steep drop in oil prices since last summer.

The U.S. oil rig count, however, is nearing a pivotal level that experts say has already trimmed production and boosted prices, which will eventually coax oil companies back to the well pad in coming months.

North Dakota, a key shale producing state, posted a surprising jump in oil and gas output in March, as producers leaned on newer technologies and processes to offset a slump in commodity prices.

U.S. crude futures this week eased to $59 a barrel from over $62 last week, the highest level this year, helped by a stronger dollar and bets some drillers have started boosting production, reviving worries of a new supply glut.

Despite the slight decline this week, crude futures were still 40 percent over the $42 six-year low set in March on oversupply concerns and lackluster demand.

(Reporting by Scott DiSavino, editing by Richard Chang)

Copyright 2016 Thomson Reuters. Click for Restrictions.

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