Oklahoma Rig Count Flat for Month, Down 38 Year-to-Date

OKLAHOMA RIG COUNT 07.02.19

The Baker-Hughes Active Rig Count for the state of Oklahoma stood at 102 on Friday, June 28, standing steady as compared to the count of 102 rigs tallied on May 31. But when weighed against figures from a year ago, the number of active rigs in the state is markedly down—being 38 rigs fewer than at this point in 2018.

Meanwhile, for the month, crude oil prices experienced another drop. Crude prices stood at $56.98 on Wednesday, July 3, showing a decline of about $5 a barrel from a month previous

Oklahoma Rig Count 2 July 2019 Map

Various explanations have been offered for the sluggishness in crude oil pricing, including slackening demand, worries over U.S.-China trade talks, and other market factors, but some analysts still think prices could rally in the last half of the year and could even possibly hit a high (for calendar year 2019 at least) this year.

Janelle Stecklein, a reporter for CNHI News (cnhinews.com) wrote on July 1 that the number of active rigs in Oklahoma could continue to drop, if Chad Warmington, president of the Petroleum Alliance of Oklahoma, is correct in his assessment.

And if the number drops, then “For Oklahoma, that means significantly few jobs and [less] tax income,” Warmington said. “The decline in revenue is coming; you’re just not seeing it yet.”

Stecklein quoted Warmington as saying that interest in developing petroleum in Oklahoma has dropped fairly significantly.

Said Warmington: “The state is competing against better oil and gas fields in other states; rig efficiency has increased; and the Legislature has raised taxes on drillers by as much as $700 million. Comparatively, I always like to say that our producers vote where they move their rigs, and they have voted by moving their rigs to other states.”

The accompanying map, created by Baker Hughes, shows the locations of Oklahoma’s 102 active rigs. The heaviest concentration, clearly, lies in the SCOOP/STACK region.

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