Rigs Seeking Energy in U.S. Drop by Two, Baker Hughes Reports

Rigs targeting oil and natural gas in the U.S. decreased by two this week to 1,769, according to Baker Hughes Inc. (BHI)

Oil rigs rose by five to 1,430, data posted on the company’s website show. The gas count dropped by seven to 335, the Houston-based field services company said. Miscellaneous rigs were unchanged at four.

A combination of hydraulic fracturing and horizontal drilling have unlocked shale deposits of oil across the U.S., and drilling efficiencies have helped boost the yield per rig to record volumes from the North Dakota’s Bakken play to Texas’s Eagle Ford. The surge in output helped the U.S. meet 86 percent of its own energy needs in the first 11 months of 2013, the highest level since 1986, EIA data show.

“We’re getting far more output for far less input,” Ed Breiner, chief executive officer at West Chester, Pennsylvania-based rig-maker Schramm Inc., said yesterday in an interview at Bloomberg’s Houston office. “From my perspective, it’s a matter of margin enhancement.”

U.S. oil output dropped 89,000 barrels a day, or 1.1 percent, in the week ended Feb. 21, to 8.06 million, data compiled by the Energy Information Administration show. Crude stockpiles climbed 68,000 barrels to 362.4 million.

West Texas Intermediate crude for April delivery rose 27 cents to $102.67 a barrel at 1:07 p.m. on the New York Mercantile Exchange, up 12 percent in the past year.

U.S. gas stockpiles dropped 95 billion cubic feet last week to 1.348 trillion, EIA data show. Supplies were a record 34.5 percent below the five-year average and 40.2 percent below year-earlier levels.

Natural gas for April delivery increased 11.8 cents, or 2.6 percent, to $4.629 per million British thermal units on the Nymex and has surged 33 percent in the past year.

To contact the reporters on this story: Lynn Doan in San Francisco at ldoan6@bloomberg.net; Richard Stubbe in Houston at rstubbe1@bloomberg.net

To contact the editors responsible for this story: Dan Stets at dstets@bloomberg.net Richard Stubbe, Charlotte Porter

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