Permian Drillers Boost Oil Rigs in Latest Bid for Sustaining Growth

By Bloomberg

Nov 17, 2023

image is BloomburgMedia_S4A53QT0G1KW01_20-11-2023_12-59-14_638360352000000000.jpg

A gas flare burns past a pump jack in the Permian Basin area of Loving County, Texas, U.S., on Monday, Dec. 17, 2018. Once the shining star of the oil business, gasoline has turned into such a drag on profits that U.S. refiners could be forced to slow production in response.

Drillers in the US shale patch are again trying to rebound from slumping activity, this time expanding the oil-rig count by the widest margin in nine months.

The number of US rigs drilling for oil rose by 6 to 500, the biggest weekly jump since late February, according to data released by Baker Hughes Co. on Friday. The boost was led by explorers in the Permian Basin of West Texas and New Mexico, where four oil rigs were added. That’s the biggest increase in the region since mid-March.


Drilling-rig activity has shown signs of coming to life in the recent past, only to drop to new lows this year. Views from the biggest onshore rig contractors during the latest round of earnings calls indicated that a bottom in activity should emerge and that drilling growth should return in the final three months of the year.

Oil output from the Permian Basin is set to expand through the end of this year, according to a report this week from the US Energy Information Administration. It’s a more bullish forecast from the government agency compared with a month earlier.


©2023 Bloomberg L.P.

By David Wethe


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