The Zacks Analyst Blog Highlights: Baker Hughes Co, Halliburton Co, Schlumberger, Transocean and Diamondback Energy

For Immediate Release

Chicago, IL – March 4, 2021 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Baker Hughes Company BKR, Halliburton Company HAL, Schlumberger Ltd. SLB, Transocean Ltd. RIG and Diamondback Energy Inc. FANG.

Here are highlights from Wednesday’s Analyst Blog:

Permian Basin Witnesses Addition of 4 Oil Drilling Rigs

In its weekly release, Baker Hughes Co. reported an increase in the U.S. rig count.

More on the Rig Count

Baker Hughes’ data, which is issued at the end of every week since 1944, helps energy service providers gauge the overall business environment of the oil and gas industry.

A change in the Houston-based oilfield service player’s rotary rig count affects demand for energy services like drilling, completion and production, provided by the likes of Halliburton Co., Schlumberger, along with Transocean.

Details

Total U.S. Rig Count Increases: The count of rigs engaged in exploration and production of oil and natural gas in the United States was 402 for the week through Feb 26 versus the prior-week figure of 397. However, the current national rig count is below the year-ago level of 790.

The number of onshore rigs for the week ended Feb 26 totaled 385 compared with the prior-week count of 380. Notably, no rig operated in inland waters as compared to one rig in the prior week. However, in offshore resources, 17 rigs were operating versus the prior-week count of 16.

US Adds 4 Oil Rigs: Oil rig count was 309 for the week through Feb 26 compared with 305 in the week ended Feb 19. Investors should also note that the current tally of oil rigs — far from the peak of 1,609 attained in October 2014 — is, however, below the year-ago figure of 678.

Natural Gas Rig Count Increases in US: Natural gas rig count of 92 was higher than the prior-week count of 91. However, the count of rigs exploring the commodity was below the prior-year week’s 110. Per the latest report, the number of natural gas-directed rigs is almost 94.3% below the all-time high of 1,606 recorded in 2008.

Rig Count by Type: The number of vertical drilling rigs totaled 25 units versus the prior-week count of 24. Moreover, horizontal/directional rig count (encompassing new drilling technology with the ability to drill and extract gas from dense rock formations, also known as shale formations) of 377 compared favorably with the prior-week level of 373.

Gulf of Mexico (GoM) Rig Count Increases: GoM rig count was 17 units, of which all were oil-directed. The count was higher than the prior-week tally of 16.

Rig Count in Prolific Basins

Permian — the most prolific basin in the United States — recorded a weekly oil rig tally of 207 versus the prior-week count of 203. In the Marcellus shale play, the weekly tally for gas drilling rigs has increased to 31 from the prior-week count of 30.

Outlook

The price of West Texas Intermediate crude, which is trading above $60 per barrel (close to pre-pandemic levels), has improved significantly since April 2020, when oil was in the negative territory. The momentum is likely to continue since the coronavirus vaccine rollout will possibly help the economy recover strongly this year, thereby aiding fuel demand. Thus, oil and gas drillers are likely to continue adding rigs to shale plays since the pricing environment is gradually improving.

Meanwhile, investors may keep an eye on this energy stock expected to benefit if the oil price rally sustains: Diamondback Energy, which has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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Transocean Ltd. (RIG) : Free Stock Analysis Report
 
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