September 15, 2017 / 5:12 PM / 10 months ago

U.S. drillers cut most oil rigs since January -Baker Hughes

    Sept 15 (Reuters) - U.S. energy firms cut the most oil rigs
in a week since January as a 14-month drilling recovery stalled
due to weak crude prices.
    Drillers cut seven oil rigs in the week to Sept. 15,
bringing the total count down to 749, the least since June,
General Electric Co's        Baker Hughes energy services firm
said in its closely followed report on Friday. RIG-OL-USA-BHI
    Drillers have not added any rigs since the week of Aug. 11.
    The rig count, an early indicator of future output, is still
higher than the 416 active oil rigs a year ago as energy
companies had mapped out ambitious spending programs for 2017
when they expected U.S. crude        to be higher than the $50
per barrel where they are currently trading.      
    Crude prices were up about 5 percent so far this month after
declining in five of the past six months, including a near 6
percent drop in August as rising U.S. output helped to add to a
global glut.
    U.S. production is expected to rise to 9.3 million barrels
per day (bpd) in 2017 and a record 9.8 million bpd in 2018 from
8.9 million bpd in 2016, according to federal energy projections
this week.        
    Although several exploration and production (E&P) companies
have trimmed their investments for this year due to the drop in
crude prices, they still planned to spend much more this year
than last year.
    Analysts at Simmons & Co, energy specialists at U.S.
investment bank Piper Jaffray, this week revised higher its
forecast for the total oil and gas rig count, now expecting it
to rise to an average of 884 in 2017, 959 in 2018 and 1,114 in
2019. Last week, it forecast 863 in 2017, 932 in 2018 and 1,078
in 2019.
    That compares with 857 oil and gas rigs so far in 2017, 509
in 2016 and 978 in 2015.
    Analysts at U.S. financial services firm Cowen & Co's
capital expenditure tracking was unchanged this week, showing
the 64 E&Ps it tracks planned to increase spending by an average
of 49 percent in 2017 from 2016.
    That expected 2017 spending increase followed an estimated
48 percent decline in 2016 and a 34 percent decline in 2015,
Cowen said.

 (Reporting by Scott DiSavino; Editing by Marguerita Choy)
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