Baker Hughes US oil rig count unchanged this week

• Oil rigs unchanged at 512
• Gas rigs down 1 to 114
• Oil rigs down 16% from the peak

If I’m OPEC+ and looking at this, I feel totally in control. There’s no surge of US production coming to counter OPEC cuts.

Some notes from John Kemp:

• Based
  on the historical record, after prices peak it takes on average 5
  months for drilling to turn down and 12 months for production to
  decline.
• Following the drilling peak, Lower 48 output is likely to peak in the third quarter of 2023
• Flat or falling Lower 48 production will contribute to a tightening global oil market during the final four months of 2023

It’s no wonder WTI crude is above $85 today. It could blow out higher next week if OPEC gets aggressive.