More Oil And Gas Operator Pessimism; US Rig Count Down Again

April 8, 2016

The outlook for oil and gas operators continues to be pessimistic across Colorado and the U.S., according to a new Energy survey from the Federal Reserve Bank of Kansas City.

Business activity dropped again during the first quarter of this year as companies laid off employees and downsized -- and the companies aren’t optimistic about the future.

Those surveyed said they need an average of $51 per barrel to be profitable. Right now the price of oil is hovering around $40 per barrel.

Many companies said they don’t expect oil production to become profitable again until 2017.  That could mean more budget cuts and layoffs later this year.

US Rig Count Drops Again; Colorado Unchanged

The number of rigs exploring for oil and natural gas in the U.S. dropped by seven this week to 443, another all-time low. A year ago, 988 rigs were active.

Houston oilfield services company Baker Hughes Inc. said Friday 354 rigs sought oil and 89 explored for natural gas.

Among major oil- and gas-producing states, Texas lost seven rigs and North Dakota two. Alaska, California and Kansas each dropped one.

Ohio and Oklahoma gained two rigs apiece, while New Mexico was up one.

Arkansas, Colorado, Louisiana, Pennsylvania, Utah, West Virginia and Wyoming were unchanged.

The U.S. rig count peaked at 4,530 in 1981. The previous low of 488 set in 1999 was eclipsed March 11, and has continued to dip.

The Associated Press contributed to this report

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