The global rig count is a critical metric in the oil and gas industry that reflects the number of drilling rigs actively exploring or drilling for oil and natural gas worldwide. It serves as a key indicator of the oil and gas industry’s health, exploration activity, and potential shifts in energy markets.
This report delves into the analysis of the global rig count as of the most recent data available by Baker Hughes.
Data Source: Baker Hughes
From Chart 1 above, here are some key insights on the global rig count in August 2023:
- The cumulative global rig count in August 2023 stands at 1,788 rigs, down by 32 rigs compared to July
- Latin America’s rig count in August stood at 173 rigs
- Europe had a rig count of 121 rigs in August
- Africa, in August, had a rig count of 109 rigs
- In the Middle East, the rig count in August was 329 rigs
- Asia Pacific had a rig count of 220 rigs in August
- Canada’s rig count in August stood at 189 rigs
- The United States rig count in August was 647 rigs
The global rig count is distributed across several regions, each with its own unique dynamics and contributing factors. Here is a detailed regional breakdown of the rig count:
- Latin America: Latin America encompasses a diverse range of oil-producing countries, with significant rig activity in countries such as Brazil, Mexico, and Venezuela. The region’s rig count is influenced by factors like political stability, commodity prices, and the development of offshore reserves.
- Europe: Europe’s rig count primarily centers around countries in the North Sea, including the United Kingdom, Norway, and the Netherlands. This region’s count is heavily affected by North Sea oil and gas developments, exploration projects, and environmental regulations.
- Africa: Africa has seen a notable increase in drilling activity, driven by discoveries in countries like Egypt, Nigeria, and Angola. Political stability, security concerns, and infrastructure development play a crucial role in shaping drilling operations in this region.
- United States: The United States leads the global rig count, reflecting its extensive oil and gas operations, both onshore and offshore. Factors such as shale production, regulatory policies, and global oil prices are significant drivers of rig count fluctuations.
- Middle East: The Middle East stands as a dominant player in global rig count figures, primarily driven by OPEC nations such as Saudi Arabia, Iraq, and the United Arab Emirates. The region is highly sensitive to global oil prices, geopolitical events, and production quotas.
- Asia Pacific: The Asia Pacific region is marked by drilling activity in countries like China, Australia, and Indonesia. Expanding oil demand, technological advancements, and exploration of unconventional resources impact rig counts in this region.
- Canada: Canada’s rig count is influenced by its vast oil sands reserves and conventional drilling projects. Seasonal variations due to weather conditions in regions like Alberta could have a substantial impact on rig activity.
AFRICA RIG COUNT (AUGUST 2023)
Africa’s rig count is heterogeneously dispersed across the continent. The top five countries with the highest rig counts, as of August, are Algeria, Nigeria, Libya, Angola, and Kenya. Specifically, the total rig count in Africa in August was 109 rigs, with an increase of 7 rigs, compared to July, signifying the continent’s active participation in global drilling endeavors.
Data Source: Baker Hughes
As seen in Chart 2 above, the rig count’s distribution across African nations showcases the diversity of oil and gas activities, with North African countries like Algeria and Libya leading, followed by West African giants Nigeria and Angola, and East African emerging players like Kenya.
Algeria, a North African energy powerhouse, leads the African rig count with a total of 37 active rigs in August 2023.
Nigeria, another heavyweight in African energy, holds the second-highest rig count with a total of 18 active rigs as of August. It remains the largest oil producer on the continent. Libya, Angola, and Kenya had rig counts of 14, 10, and 6 respectively.
NIGERIA RIG COUNT (AUGUST 2023)
Nigeria’s rig count, like many other oil-dependent economies, is sensitive to global oil price trends. Upticks in oil prices often stimulate drilling activities, while price declines can prompt cost-saving measures within the industry.
Exploration prospects, especially in Nigeria’s offshore fields, also play a pivotal role in shaping the rig count. Major discoveries or the launch of exploration initiatives can lead to increased drilling activities.
Data Source: Baker Hughes
Year-to-date, the rig count in Nigeria displayed periods of stability interspersed with minor fluctuations. These fluctuations could be influenced by various factors, including project schedules, exploration opportunities, or external market dynamics such as oil prices.
As seen in Chart 3 above, August has the highest number of rigs since January 2023.
This is a notable increase in drilling activities within the country. Factors such as new project kick-offs, market dynamics, or strategic initiatives may have contributed to this rise.
The rig count in Nigeria is expected to continue to increase in the coming months, driven by some factors, including the rising price of oil, and the development of new offshore oil fields.
The global rig count is expected to continue to increase in the coming months, due to a myriad of factors, including the rising price of oil and the increasing demand for oil from developing countries. The United States, the Middle East, and Latin America are expected to remain the leading oil-producing regions in the world.
The global rig count is a vital barometer of the oil and gas industry’s vitality and response to ever-changing global dynamics. Rig count analysis remains a crucial tool for investors, policymakers, and industry stakeholders to gauge the health and direction of the energy sector.
