By JOHN P. TRETBAR
Eagle Media
The Rotary Rig Count from Baker Hughes drops to its lowest total in more than three years. The weekly U.S. tally is down eight oil rigs and two gas rigs for a total of 566, the lowest total since November, 2021. The report shows a drop of nine horizontal rigs. Texas is down five. Oklahoma, New Mexico and North Dakota are each down two rigs.
The Kansas Rig Count from Independent Oil and Gas Service is up one in eastern Kansas at eight rigs, and down two west of Wichita at eleven active rigs. The tally is down 21 percent from a month ago and 41 percent from a year ago. Drilling was underway Friday on two leases in Finney County.
Kansas operators completed 17 new wells last week, with eight in eastern Kansas and nine west of Wichita, including one in Finney County. Independent Oil Gas Service reports 485 new well-completions so far this year, compared to 512 a year ago.
Regulators in The Sunflower State okayed eight new drilling locations statewide. There are two new permits east of Wichita, and six in Western Kansas, including two in Ellis County and one in Barton County. That's 271 so far this year, compared to 377 last year at this time.
Three years ago, the United States sold some 300 million barrels from crude oil from our strategic reserves, in an effort to tame oil prices. Today, prices are $35 per barrel cheaper, and our refill savings are approaching one BILLION dollars. The Energy Department added 800,000 barrels to the Strategic Petroleum Reserves last week, raising the total over 400 million barrels (down from over 600 million at its peak). The government has refilled 36.5 million barrels since last April. Current prices are more than $30 less than what we received selling those barrels.
Domestic crude inventories rose more than a million barrels to just over 443 million, as of May 16. The government reports stockpiles are about six percent below the five-year seasonal average.
US crude production rose slightly last week but remains below 13.4 million barrels a day for a second week. The Energy Information Administration reports average output of just over 13.39 million barrels per day, up five million daily barrels from a week ago.
Crude imports outpaced exports by two and a half million barrels a day in the week through May 16. Both are up for the week but down from a year ago. The Energy Information Administration reports just over six million barrels a day in crude imports, up 200,000 barrels a day from last week, but down more than 600,000 barrels a day from the same week last year. Crude exports averaged a little over 3.5 million barrels a day, up slightly from last week, but down 1.2 million daily barrels from a year ago. Compared to last year at this time, the four-week average imports are down 13% or nearly a million daily barrels. The four week average is down 600,000 barrels a day from a year ago, or about two percent.
Texas regulators now say oil-and-gas drillers must demonstrate that the wastewater they're producing and then injecting back into the ground is staying where they inject it. The Railroad Commission of Texas, the state's oil and gas regulator, is now acknowledging the continued and growing demand for underground saltwater disposal capacity in the prolific Permian Basin. Last week they also noted the physical limitations of the basin's disposal reservoirs. Operators must now prove in advance that the proposed injection zone is up to the task of retaining waste, and that other wells within a two-mile area won't cause problems.
It's getting expensive for operators in Colorado who continue to violate a new energy reporting law. A new probe shows 20 oil and gas companies in Colorado have failed to report the chemicals they used in drilling and fracking operations as required by the law. No one disputes the findings. The law allows the state to fine oil and gas companies $200 a day for failure to report those chemicals yet no one is explaining why upwards of $37 Million in fines have not been collected. Local media assert the government has not collected any fines or penalties for noncompliance.
Canada's only east-west oil pipeline is completing it's first year since the government expansion that tripled its capacity. The lion's share of that extra crude is going to China. About 90% of the crude oil produced in Canada, about four million barrels a day, winds up in the United States from pipelines moving oil from north to south. The Trans Mountain Pipeline moves oil west from the oil fields of western Canada to the Pacific Coast. The pipeline can move 890,000 barrels a day at full capacity. Since last May, Canada shipped about 207,000 barrels per day of Trans-Mountain crude to China. US operators took about 173,000 barrels a day. The Canadian government expects the pipeline to reach 84% capacity this year, and 92% next year.
Iraq says it welcomes new oil deals with the US in the disputed Kurdistan region, but says those deals must go through Iraq's federal government. Baghdad says two huge new US deals in the semi-autonomous region violate Iraq's constitution. Kurdistan's government signed and announced the deals last week. The two agreements are worth a combined $110 BILLION, and involve about five trillion cubic feet of natural gas and 900 million barrels of recoverable oil.
The world's fastest-growing economy is also among the largest importers of crude oil. Increasing Russia sanctions, and US tariffs, are moving a lot of that business our way. India's energy minister says they are ready to increase oil imports from the United States. India has been buying a lot of oil from Russia lately, despite ongoing international pressure. Minister Singh Puri says pricing and availability, and not ideology, will drive his energy decisions. But he did acknowledge increasing US imports would ease the Trump Administration's tariff and trade deficit concerns. India has the world's fastest growing major economy, annual energy needs topping $150 BILLION, and had a US trade deficit of well over $45 billion last year.