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On July 27, oilfield service providers saw an increase in the rigs used for drilling, indicating rising production in the future. This growth is cited due to the recent hike in oil and gas prices. In the second quarter of 2023, shale producers in the U.S. reduced the drilling and well completion to decrease the equipment and services demand. However, the recovery in crude prices in the U.S. is increasing the optimism in service companies regarding the recovery in demand.
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John Lindsay, the CEO of Helmerich & Payne, stated that the drilling market in the United States throughout the quarter was marked by concerns related to unpredictable crude oil and natural gas prices. However, the reduction in this instability has provided a sense of positivity among industry players. Furthermore, it is also expected that the rig count activity will hit its lowest point at the end of the third quarter in September, with a recovery expected in the fourth quarter of 2023.
As per the updates provided by the CEO of Patterson-UTI Energy, Andy Hendricks, the rig count is near its lowest point currently. However, it is expected that there will be more rig releases in the upcoming weeks. Moreover, the recovery in the drilling activity forecasted for the last quarter of the year is a positive outlook for the industry. Hendricks also mentioned that there was a dip in pressure-pumping activity during July, which has been stabilized for now. At the same time, the prices for spot work of pressure pumping decreased by 30 percent recently.
On July 26, Next Oilfield Solutions predicted that in the upcoming year, fracking demand will recover. However, the shortage of storage equipment will hamper the growth of oil and gas production in the U.S.
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According to Procurement Resource, Oil and service providers expect a rig count recovery later this year. This growth is anticipated due to the increase in crude prices. Currently, the rig count is at its lowest point, and it is expected that it will increase in the fourth quarter of 2023.
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