January 27, 2015

Lower 48 Oil Production Outlook Stable Despite Expected Near-term Reduction In Rig Count

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January 26, 2015 | U.S. Energy Information Administration | Troy Cook and Jack Perrin

Unsurprisingly given the 2014 oil price swoon, the EIA’s newly updated data on oil and gas rigs reveals that the lower 48 states of the U.S. saw a 16 percent decline in the number of active onshore drilling rigs in the last three months. Despite this, the outlook for overall U.S. production held steady, thanks to a backlog of wells that were invested in several months ago and are coming online in the midst of the new market outlook. This delay in completion of newer wells has so far offset the loss in production due to the recent decrease in drilling activity.

Reuters and Fuel Fix both chimed in with some company-specific numbers and context for the seemingly counterintuitive increase in production despite cuts elsewhere.