Falling prices for oil and natural gas during the novel coronavirus pandemic have prompted the closure of nearly a quarter of land-based US rigs in the United States, excluding Alaska, the Energy Information Administration (EIA) said in a report on Thursday
WASHINGTON (UrduPoint News / Sputnik – 14th May, 2020) Falling prices for oil and natural gas during the novel coronavirus pandemic have prompted the closure of nearly a quarter of land-based US rigs in the United States, excluding Alaska, the Energy Information Administration (EIA) said in a report on Thursday.
“The number of active drilling rigs in the lower 48 states, excluding the Federal Offshore Gulf of Mexico (GOM), totaled 753 as of February, but it fell to 738 in March and 572 in April… the lowest since May 2016,” the report said, citing data from the energy technology firm Baker Hughes.
The decline reflects low prices for benchmark West Texas Intermediate oil, which the report said will continue to affect production later this year and throughout 2021.
EIA’s is forecasting an 800,000 barrel per day decline in US crude production in 2021, the largest annual drop of US output on record.
Production in the Gulf of Mexico and Alaska, which account for nearly 20 percent of US oil production and are less sensitive to oil price fluctuations, will remain relatively flat, the report said.
A nationwide economic shutdown during the pandemic has sent energy prices plunging, with most Americans subject to stay-at-home orders and most businesses forced to close in an attempt to slow the contagion.
