Oil rig count falls by 94 in biggest drop since 1987

total north american oil rig count jan 30

HOUSTON – Petroleum producers took 94 oil-drilling rigs off the market in the United States this week as sub-$50 oil continued to wreak havoc on the oil industry, Baker Hughes reported Friday.

It was the biggest one-week decline for oil rigs since 1987, the earliest year of Baker Hughes data available. That year, the oil industry had faced another oil bust that left hundreds of rigs idle or repossessed by banks, which sold them for scrap.

This week’s drop left 1,223 oil units up, the lowest number in three years.

In Texas, 58 rigs were taken off the market, cutting the state’s count to 695 rigs. That’s down from 840 at the beginning of this month.

All told, the number of oil and gas rigs active in the United States fell by 90 to 1,543, as gas rigs increased by three and one other, so-called miscellaneous rig was propped up. The U.S. offshore rig count declined by 5 rigs, down to 49 units.

The decline came a day after the CEO of Helmerich & Payne CEO John Lindsay told investors the Oklahoma-based drilling contractor may have to cut 2,000 jobs in light of the falling rig count.

Lindsay said even some of the company’s souped-up FlexRigs, some of the most advanced models on the market, have been released, and that’s likely to continue.