The U.S. oil and gas industry is taking a nosedive. With the rig count falling for the sixth consecutive week as of June 2025, operators are feeling the squeeze. No sugar-coating it – this decline is brutal and shows no signs of stopping.
Numbers don’t lie. The operational rig count averaged just 557 in June, a far cry from previous years. February’s figures were equally dismal compared to the same month in 2024. Weekly changes? More decreases in both oil and gas rigs. It’s like watching a slow-motion car crash.
Volatile commodity prices are the main culprit. When oil prices tank, so does drilling enthusiasm. Companies aren’t stupid – they’re tightening belts and focusing on efficiency instead of expansion. Can’t blame them.
Follow the money and you’ll find the rigs – or lack thereof. Market realities drive drilling decisions, not wishful thinking.
The Permian Basin remains the golden child, still contributing notably to U.S. oil production while other regions falter. Day rates in the region declined by 9.35% YoY, indicating serious oversupply issues that are hampering recovery. Thank goodness for small mercies. Without the Permian, things would look even worse.
On the global stage, America’s still a heavyweight with 460 active rigs as 2024 wrapped up. But that impressive figure masks underlying issues. Production forecasts suggest U.S. crude will grow by only 120,000 barrels per day by the end of 2025. Not exactly earth-shattering.
There are glimmers of hope, if you squint. Bid inquiries have ticked up, suggesting cautious optimism among drillers. The current count sits 35 rigs below last year’s figures, showing just how far the industry has fallen. Federal policies might ease restrictions soon. LNG demand is rising, particularly in Haynesville, which could buoy natural gas production. Louisiana’s leading infrastructure development for LNG isn’t hurting either.
The recent administration has already secured key federal approvals for major LNG projects in Louisiana, which could stimulate renewed activity in that region.
Industry consolidation continues unabated. Big fish eating little fish. Classic capitalism at work. Companies are exploring new tech to cut costs and boost efficiency – they’ll need every advantage they can get.
The market remains unpredictable. Regulatory changes loom. Smaller operators face existential threats. Welcome to the roller coaster of U.S. drilling in 2025. Buckle up – it’s going to be a bumpy ride.
References
- https://oilgasleads.com/u-s-oil-and-gas-drilling-2024-trends-and-the-outlook-for-2025/
- https://www.mrt.com/business/oil/article/us-oil-gas-rig-count-decline-20365322.php
- https://www.aogr.com/web-exclusives/us-rig-count
- https://boereport.com/2025/06/06/us-oil-gas-rig-count-falls-for-6th-week-to-2021-lows-baker-hughes-says/
- https://www.statista.com/statistics/1109332/us-oil-and-gas-rigs-in-use-covid19/
