Rigs counts were down
Total oil rig counts fell sharply, -10 to 599
Horizontal oil rig counts also fell, -4 to 556
3 of 4 lost horizontal rigs were from the Permian. Worrying.
The pace of horizontal rig additions fell to -1.75 / week on a 4 wma basis
The rig count has been eroding now for 2½ months
The calculated US breakeven to add horizontal oil rigs fell to $73 / barrel WTI versus $73 on the screen at writing.
Frac spreads fell, -8 to 270, still no higher than a year ago
As with rigs, the local peak was reached on November 25th at 300 spreads.
At current rig and spread counts, at latest productivity levels, DUCs appear to be falling once again
The data suggests the US shale sector is at a turning point
WTI has averaged $85 / barrel (with a lagged value) during the last ten weeks in which rig and spread counts have been declining. This is a high price by historical standards. Nevertheless, declining rig counts say it is not high enough.
This development is unprecedented since the beginning of the shale revolution for oil, around 2010. In 2018, for example, the rig count was rising at $60 / barrel; now it is falling at $85 / barrel, and from a lower level
The latest US data for November and December show declining oil production, down about 300 kbpd compared to October. This is historically unusual.
Trouble is brewing.