At $52.70 a barrel, a nearly 50 percent decline in the price of oil since June of last year, oil-drilling activity has also dropped.
The oil producers are “not drilling because they can’t afford to,” said James L. Williams, an energy economist with WTRG Economics in Arkansas.
According to the WTRG website, the total number of oil rigs available for gas, oil, and miscellaneous drilling in the United States is 1,358, down 98 as of Feb. 13.
The number of rigs actively drilling for oil, which represents 77.3 percent of all drilling activity, is 1,056, down by 84. Last year, there were 367 more rigs drilling for oil.
Gas drilling rigs total 300, down 14. Last year 337 gas rigs were actively drilling.
Overall, oil exploration in the United States is down 25.8 percent and gas exploration has declined by 11 percent.
Williams opines that “rapidly increasing oil production in the United States will come to a halt by June because of lower drilling activity.” He estimates that oil production will decline in the second half of the year if the price of oil doesn’t go back up.
“Producers have less cash available from sales, investors, and banks,” he said.