The latest Baker-Hughes data release shows that total US oil and gas drilling has fallen below 1,000 rigs for the first time since September 2009. The y/y decline stands at 46%, which makes the downturn the fifth-deepest recession for the US oil and gas industry since 1950 . The y/y decline is set to deepen in coming months, as the 2014 peak of 1,930 rigs was not reached until September 2014. By end-April the y/y decline is expected to exceed the maximum for the 1983 and 1999 downturns, and then it is likely to overtake the (primarily gas rig-related) decline of 2008-09. That would make the scale of the current industry recession second only to 1986, when the y/y decline bottomed out at 65.7%. “We expect oil prices to rebound from this point, and we do not expect 2015 to surpass 1986 in terms of the scale of US oil and gas industry retrenchment. However, if prices remain low through Q2 and Q3, we would expect the y/y decline to exceed the 1986 trough by September”, Said Standard Chartered in a report on Tuesday
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