Feb. 8 (Bloomberg) -- Oil and gas rigs in the U.S. dropped for the first time in three weeks, Baker Hughes Inc. data show.
Total energy rigs declined by five to 1,759, according to data posted on Baker Hughes’ website. The gas count fell by three to 425, the field-services company based in Houston said. Oil rigs dropped by two to 1,330.
The U.S. energy rig count has fallen for eight straight months as producers get more gas and oil from wells using a combination of horizontal drilling and hydraulic fracturing, or fracking. U.S. oil output reached a 20-year high last month, and gas stockpiles grew to a record in November.
“The question regarding oil drilling is: When is too much enough? How steep of a growth rate do you really want?” Tim Evans, an energy analyst at Citi Futures Perspective in New York, said by telephone. “In natural gas drilling, I think the real intermediate-term story here is that the amount of drilling has basically stabilized around this 425- to 430-rig level.”
U.S. oil output climbed 4,000 barrels a day to 7 million last week, according to the Energy Information Administration, a division of the Energy Department. Production rose to the highest level since January 1993 on Jan. 11. Stockpiles of the feedstock rose 0.7 percent to 371.7 million barrels last week and reached a 22-year high of 387.3 million in June.
Crude for March delivery fell 11 cents to settle at $95.72 a barrel today on the New York Mercantile Exchange, down 3 percent from a year ago.
Gas stockpiles fell 118 billion cubic feet in the week ended Feb. 1 to 2.684 trillion, according to data compiled by the EIA. They reached a record high of 3.929 trillion cubic feet on Nov. 2.
Natural gas for March delivery dropped 1.3 cents to settle at $3.272 per million British thermal units on the Nymex, up 34 percent from a year ago.
New Mexico lost the most rigs this week, dropping three to 76. Louisiana gained the most, increasing five to 111.
Rigs on land fell by seven to 1,688. Rigs in inland waters were unchanged at 16.
Vertical rigs tumbled by 14 to 431, the lowest since January 2010. Horizontal rigs climbed by seven to 1,143, the highest level since September.
“If you look at the total picture, horizontal rigs are still net up because they produce higher initial production,” James Williams, president of WTRG Economics in London, Arkansas, said by telephone.
The offshore rig count, primarily in the Gulf of Mexico, gained two to 55, the most since April 2010.
Energy explorers such as Chevron Corp., Royal Dutch Shell Plc and Transocean Ltd. have been directed by U.S. regulators to suspend work aboard rigs that employ General Electric Co. devices connecting drilling tubes to safety gear and the sea floor. The equipment must be retrieved so defective bolts can be replaced, the U.S. Bureau of Safety and Environmental Enforcement said in an alert issued on Jan. 29.
Canadian energy rigs jumped for a sixth week, increasing by six to 631, following a seasonal drilling pattern.
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