U.S. Energy Rigs Drop for Second Week, Baker Hughes Says

Rigs targeting oil and natural gas in the U.S. declined by seven this week to 1,764, according to Baker Hughes Inc. (BHI)

Oil rigs increased by seven to 1,423, the most since August 2012, data posted on the company’s website show. The gas count dropped by 14 to 337, the lowest level since 1995, the Houston-based field services company said.

The total rig count has fallen by 21 this month as a series of storms dumped snow and ice on the Gulf Coast and the eastern U.S., slowing oil- and gas-drilling operations in major plays. The Energy Department cut crude-output forecasts by 120,000 barrels a day for this year and 100,000 for 2015.

The forecasts were cut on “indications that severe weather this winter has caused temporary slowdowns in completing new wells,” the Energy Information Administration in Washington said in its short-term energy outlook released Feb. 11.

U.S. oil output climbed for the first time in four weeks in the seven days ended Feb. 7, increasing 1.1 percent to 8.13 million barrels a day, the EIA said. Crude stockpiles rose 3.27 million barrels to 361.4 million.

West Texas Intermediate crude for March delivery fell 8 cents to $100.27 a barrel at 1:06 p.m. on the New York Mercantile Exchange, up 3 percent in the past year.

U.S. gas stockpiles tumbled 237 billion cubic feet last week to 1.686 trillion, the EIA said, as freezing weather boosted demand for the heating fuel. Supplies were a record 27 percent below the five-year average and 34 percent below year-earlier levels.

Natural gas for March delivery rose 1.9 cents, or 0.4 percent, to $5.242 per million British thermal units on the Nymex and has surged 66 percent in the past year.

To contact the reporter on this story: Lynn Doan in San Francisco at ldoan6@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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