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North America Gas Rig Count


       
  1 Year   3 Years   5 Years   Max
Last update: June 7, 2019, 13:00 EDT

Description

Rig Count chart shows the total (weekly) number of rigs directed toward natural gas in North America: United States + Canada (bright blue curve). The chart also displays 5-year average number of gas rigs (pale blue curve - dashed) and 52-week average (light orange curve - dotted). 

Historical data is available from January 6, 2006.

The chart is interactive. You can click on any series in the legend to hide/show the data. You can also click on the chart and drag out a specific area you wish to zoom. Alternatively, use calendar filter to select a specific data range. Also, to print or download the chart, click on the "menu" button in the top right corner of the chart.

Update: every Friday

Source: Baker Hughes

TRADERS' NOTE

In order to produce natural gas, you need to find it. The search for reserves is referred to as exploration. Exploration involves a preliminary assessment of geological structures of interest, often using seismic technology. Fleets of drilling rigs of various types then deployed to potentially viable areas to locate and ultimately extract natural gas. Exploration results in production, and production impacts prices. There is often (but not always) a direct feedback of prices to the exploration process - lower prices should reduce the incentive to explore. The number of rigs, which are active at any given time, the rig count, is a commonly discussed statistic as many consider it to be a leading indicator of future production and, therefore, price changes.

Although rig count continues to mesmerize market participants, it is not clear that it is a particularly useful statistic from a trading perspective. We deliberately did not superimpose Henry Hub prompt month prices on the chart above as we do not want to imply that there is a strong correlation between the rig count and the price. Indeed, there are reasons to believe that rig count and prices may only be loosely correlated. Rig count is one step removed from the setting of market prices: production responds to rig count, and price responds to production, not to mention demand and inventory level. In addition, improvements in rig technology means that newer rigs are more efficient than older ones, endowing the rig count statistics with an inherent non-stationarity. Complicating matters further is the fact that drilling is not always followed immediately by production.

attributed to: Richard Lassander and Glen Swindle

Related charts: Gas Rigs (United States); Gas Rigs (Canada).

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