The latest batch of US economic indicators was mixed last week. Thursday’s initial unemployment claims and durable goods orders data were upbeat, while Friday’s GDP report was lackluster. The best news wasn’t widely reported. I have started to monitor the Baker Hughes weekly and monthly census of the number of drilling rigs actively exploring for or developing oil or natural gas in the United States. Here are the latest developments:
(1) The weekly rig count rose to 2,008 during the week of January 27. The monthly rig count remained around 2,000 for the fourth month in a row during January. That matches the previous record high during September 2008, which was led by gas rigs. The rebound from 2009 has been led by oil rigs, which are up from a low of 187 during May 2009 to a high of 1,208 during January, the highest since 1987, when the oilfield services company separated oil and gas counts.
(2) The surge in oil rigs is starting to pay off in higher US production. Crude oil field production rose to 5.67mbd during the week of January 20, based on the 52-week moving average. That’s up from an August 25, 2006 low of 4.87mbd, and the most since May 28, 2004. (More for subscribers.)