According to Baker Hughes Inc., the number of operational oil rigs in the United States declined to lows last observed in December 2009, a clear sign of the effect of plunging crude oil prices.
For the week ending 19 February 2016, operators shut 26 rigs, bringing the total count to 413. Total number of operational rigs during the same period in the U.S. was 514, comprising of 413 oil rigs and 101 gas exploration rigs.
There was some optimism in the market based on the meeting of OPEC members Saudi Arabia, Qatar and Venezuela and non-OPEC member Russia that planned to curtail production to January 2016 production levels. The supply cut would help prop-up crude oil prices to around $50 by June 2016.
Market analysts forecast the rig count to decline in the coming months and then rise in line with rising crude oil prices.
U.S. shale gas producers have hedged 2017 crude oil prices in the futures market at around $45 a barrel, anticipating a price recovery in prices.