U.S. Rig Count Drops for First Time in Six Weeks
U.S. energy firms cut the number of operating oil and gas rigs for the first time in six weeks, according to Baker Hughes’ weekly rig count report.
The Numbers
- Total rig count: 550 (down 1 from last week)
- Oil rigs: 407 (down 2, lowest since December)
- Gas rigs: 134 (up 1, highest since July 2023)
- Year-over-year: Down 43 rigs (7%)
What’s Driving the Decline
Lower U.S. oil prices continue to push operators toward shareholder returns and debt reduction rather than increased drilling activity.
According to TD Cowen, 17 of 21 E&P companies they track plan to spend about 1% less in capital expenditures in 2026 compared to 2025. This follows a 4% decline in 2025 and roughly flat spending in 2024.
Impact on Field Services
For drilling contractors, well service companies, and field service providers, the numbers suggest another year of disciplined activity rather than growth.
The U.S. Energy Information Administration projects crude output will hold steady at 13.6 million barrels per day in 2026, matching last year’s record. Natural gas output is expected to rise from 107.6 to 110.0 billion cubic feet per day.
The Takeaway
Subcontractors should expect:
- Flat-to-lower drilling activity in oil basins
- Modest growth in gas-focused regions
- Continued pressure on day rates and service pricing
- Focus on efficiency over volume
For service companies, this environment favours operators who can demonstrate cost efficiency and reliability over those competing purely on price.
