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Oil drillers cut US rig fleet in aftermath of Opec moves
[NEW YORK] Crude explorers scaled back drilling in US oil fields by the most in three months after the world's top exporters agreed to raise production.
US working oil rigs fell by four this week to 858, according to data from Baker Hughes. It was the second straight weekly decline and the largest drop since March.
Shale fields in South Texas and North Dakota were among the hardest hit by the reductions, according to Baker Hughes. In the Permian Basin of West Texas and New Mexico, the rig count held steady at 473 this week. As the most-prolific American oil field, the Permian accounts for 55 per cent of all the active rigs in the country.
The US rig data is "slightly bullish" for oil prices, Leo Mariani, an analyst at NatAlliance Securities LLC, said in an email.
American producers are bracing up for an expansion in global oil supplies after members of the Organization of Petroleum Exporting Countries and allied producers agreed last week to end their cap on output. Saudi Arabia has pledged to pump more crude than it has ever produced as soon as next month.
West Texas Intermediate crude, the benchmark for US producers, has risen more than 8 per cent this week as shrinking stockpiles in the world's biggest economy and supply disruptions around the world overshadowed the looming output increases by the Saudis and other nations.
Crude output in the US has been at a record 10.9 million barrels a day for two consecutive weeks, according to the Energy Information Administration.