Prices this week hit new highs for the year on news of slowing production in the U.S.
The Baker Hughes (ticker: BHI) rig count for the week ended April 17, 2015 showed yet another drop in the number of rigs actively drilling for oil and gas in the United States. The total rig count fell to 954, down about 3% from last week’s count of 988. Of those, 734 were drilling for oil and 217 were drilling for gas. The oil rig count fell by about 3% while the number of rigs drilling for gas was 4% lower than last week’s count despite a small uptick in the week ended April 10, 2015.
News this week that U.S. oil production is beginning to slow sent prices up to their highest point yet this year, with West Texas Intermediate (WTI) reaching $56.71 and Brent hitting $63.98 on April 16. Both WTI and Brent have dropped in trading today, but are remaining steady around $56 and $63.90, respectively.
As the U.S. rig count continues to fall, production has begun to follow suit. Production slowed around 2% in the U.S. sparking the sharp rise in oil prices earlier this week. Production declines also helped lower storage additions, reducing fears that the country may run out of storage space for oil.
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