There’s a classic “Peanuts” comics episode in which Charlie Brown, after enduring Lucy’s explanation of the numbers behind her club’s won-loss record, says, “Tell your statistics to shut up.”
So while current U.S. rig count numbers don’t lie, they may not tell the whole story, either.
“The rig count decline is not only a function of lower commodity prices but also a good indicator of how to balance to the market,” said Roger Read, senior energy analyst at Natixis Bleichroeder. “The decline is part of bringing supply and demand back into balance.”
And according to Baker Hughes Investment Relations, decline it has been.
The company’s data, traditionally a marker of industry health and vitality, showed a global decline in rig counts, from 7 percent from January to February; the decline from February 2008 to February 2009 was almost 20 percent.
Internationally, the rig count in February was down by 664 over the previous year.
In the United States alone, the drop was 15 percent from January and 25 percent from February 2008. Additionally, there are 520 fewer rigs being operated in the United States this year compared to last. The total stands now at 1,243.
Since 1940 the highest weekly U.S. rig count was 4,530 (December 1981); the lowest count was 488 just two years earlier.
Looking specifically at the western United States, here’s how the February 2009 rig counts compare to those of one year earlier:
In the largest oil and gas producing states, the numbers for the same period are: