Rig counts plummet except where they don't.
With drilling, major Arab oil producers on the Persian Gulf seem oblivious to unaccommodating crude prices.
Attention usually focuses on the Baker Hughes Inc. rig count for the US, which during the week of July 17 resumed a long decline after a couple of feeble increases. The total: 857, down 6 from the previous week and 1,014 from the same week a year earlier.
The Canadian count of active rotaries gained 23 units for the week, to 192, but still was down 189 from the comparable week of 2014.
The international count, which Baker Hughes updates monthly without North American totals, also is droopy. The June total was 1,146, down 12 from May and 198 from June 2014.
Apparently, officials in Saudi Arabia, Abu Dhabi, and Kuwait don't think drilling has to slump when crude sheds value.
Last month, 121 rigs were busy in Saudi Arabia, 17 more than in June 2014. That's a trend. The June 2013 number was 82.
Abu Dhabi's rig count increased by 6 from June 2014 to 39. The June 2013 number: 26.
In Kuwait, June rig counts were 50 this year, 35 in 2014, and 34 in 2013.
It's fair to say these countries are bucking a global trend.
Three characteristics are common to Saudi Arabia, Abu Dhabi, and Kuwait:
• They produce a lot of crude-about 16 million b/d combined recently, 18% of global oil supply.
• They have a lot of oil-465 billion bbl in combined reserves, 28% of the world total, and it's conventional.
• Their decision-makers plan for the long term.
Although the aggregate reserves-life index implied by these numbers is 80 years, some of the drilling is exploratory.
Saudi Aramco, for example, discovered eight fields last year, the most in its history: Abu Ali, Faras, Amjad, Badi, and Faris gas fields; Sadawi and Naqa oil fields; and QadQad oil and gas field.
Long term, indeed.
(From the subscription area of www.ogj.com, posted July 17, 2015; author's e-mail: [email protected])