The number of oil rigs in the U.S. decreased for the fifth time in the last six weeks, according to oilfield services company Baker Hughes data on Wednesday.
The oil rig count in the U.S. fell by 3 to reach 538 from 541 this week. This is a 66.5 percent decline since October 2014 when the count was at its highest level with 1,609.
Last week, the number of oil rigs in the country increased massively, by 17 from the week before, and ending the slump in rig count that had lasted for four weeks.
The oil rig count in the U.S. provides an indication about the well-being of the oil sector in the country, and signals possible short-term production cuts and increases.
Due to low oil prices, the U.S. producers are having a difficult time to see a return of their investments. As a result, oil rigs and wells are shut down, while production decline.
Because of plummeting prices, domestic oil production in the country fell more than 400,000 barrels a day since April when it reached its highest level since the 1970s at almost 9.6 million barrels a day.
Nevertheless, U.S. oil producers have turned out to be resilient against the price slump. Oil production in the country stood at 9.18 million barrels a day for the week ending Dec. 18, according to the U.S. Energy Information Administration (EIA).
However, the glut of oil supply remains in the market with strong crude inventories from the U.S. and overproduction from OPEC, both of which continue to put downward pressure on oil prices.
By Ovunc Kutlu
Anadolu Agency
ovunc.kutlu@aa.com.tr