U.S. oil drillers cut rigs with crude price decline -Baker Hughes

By Scott DiSavino
Sept 11 (Reuters) - U.S. energy firms cut oil rigs for a
second week in a row, data showed on Friday, a sign the latest
price declines may be causing some drillers to put on hold their
recently announced plans to return to the well pad.
Drillers removed 10 rigs in the week ended Sept. 11 and 13
rigs in the week ended Sept. 4, bringing the total rig count
down to 652, after adding rigs in six of the past eight weeks,
oil services company Baker Hughes (NYSE:BHI) Inc BHI.N said in its
closely followed report.
Those additions since the start of July showed some drillers
had followed through on plans to add rigs announced in May and
June when U.S. crude futures CLc1 averaged $60 a barrel.
U.S. oil prices this week, however, averaged $45 a barrel,
down from an average of $47 last week.
Crude prices on Friday fell more than 2 percent after two
banks, Goldman Sachs (NYSE:GS) and Commerzbank (XETRA:CBKG), both slashed their crude
forecasts, citing lingering oversupply concerns and worries over
China's economy. O/R
"The oil market is even more oversupplied than we had
expected and we forecast this surplus to persist in 2016,"
Goldman said in a note entitled "Lower for even longer."
In response to falling prices, U.S. oil production has
declined over the past several weeks with current output down to
about 9.1 million barrels per day last week from an average 9.6
million bpd from late May to mid July, the highest since the
early 1970s, according to government data.
Those output reductions occurred months after U.S. energy
firms slashed spending, cut thousands of jobs and idled around
60 percent of the record high 1,609 oil rigs that were active in
October as prices collapsed from around $107 a barrel in June
2014 to under $44 in January on lackluster global demand and
lingering oversupply concerns.