In an industry where volatility is the only guarantee, manufacturers are keeping a close eye on the future of oil and gas. With news breaking about automobile manufacturers making the dramatic shift to all-electric vehicles and global inventories rising, all eyes were on the Rig Count released by Baker Hughes on July 21st.
After three straight weeks of non-gains, the U.S. added two oil rigs and six gas rigs last week. This brings the total U.S. active oil rigs up to 766 and total gas rigs climbed to 192. Both the oil rig and gas rig totals are up over 100% year over year. This past week of gains signaled that oil producers will continue to push through the murky future and continue expanding operations as long as the price of oil allows it.
Crude prices have been on a steady incline since mid-June and both BRENT, the international benchmark, and U.S. standard WTI are showing signs of recovery. WTI is hovering just under $50.00 per barrel at $49.68 today and BRENT reached $52.23 (2:06 pm EST 7/31/2017).
There are signs that the oil industry is on track to regain some of the ground it lost in February of 2016 when both BRENT and WTI dropped below $30 per barrel. This sent the oil rig count crashing and manufacturers were left without the consistent work and business a booming oil industry brings with it. Saudi Arabia and the rest of the Organization of Petroleum Exporting Countries (OPEC) recently discussed extending the oil production cap agreement to further dampen the glut in supply. The latest OPEC meeting ended with some promising results and would have no doubt aided in oil’s recovery.
As the oil industry continues to face major disruptions both domestically and internationally, manufacturers must keep up with the latest developments. This is a critical industry for many manufacturers in the U.S. and abroad and many companies rely on it to keep business moving. Understanding the latest trends can help keep manufacturers one step ahead of the volatile oil market.