Reaching Rig Bottom? Oil Rigs Decline for 17th Straight Week [Chart]
Reaching Rig Bottom? Oil Rigs Decline for 17th Straight Week
The Chart of the Week is a weekly feature in Visual Capitalist on Fridays.
For the 17th straight week, the amount of operational oil rigs has declined in the United States to 802. This is now over a 50% decline since last October, and the last time we had a rig figure this low was the week ending March 4, 2011.
However, as you can see in our chart this week, production is not slowing one bit. US production is now at its highest level since 1972 at 9.3 million bpd. This is the real story, as new efficiencies in oil drilling and pumping have made it so companies can do more with less rigs.
As a result, the amount of oil stored each week is actually setting new records. The Energy Information Administration estimates that the supply in the United States has outpaced refiner demand by 1 million barrels per day since January. At this rate, there will simply not be enough capacity to store all of this crude.
The share of capacity filled in Cushing, Oklahoma has jumped from 41% to 80% over the course of the last year. This storage problem will continue to put price pressure on Texas Tea – it would take some serious geopolitical events to pull oil out of its rut.
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