BH Rigs: Rigs down, frac spreads up



  • Oil rigs declined, -1 to 866

  • Horizontal oil rigs fell, -3 to 766

  • The 4 wma change for horizontal oil rigs fell to 0.0 / week

  • Horizontal oil rigs have gone exactly nowhere in the last 14 weeks

  • The Permian added 3 rigs, the Cana Woodford was hammered with a loss of 6 rigs

  • The breakeven oil price to add horizontal oil rigs is now $70 WTI, about the same as WTI

  • The model suggests horizontal oil rig counts will decline again next week

  • Frac spreads once again saw a very strong recovery, up 9 to 454

  • While the frac spread ratio remains below normal, it is rebalancing, both by spread adds and rig reductions

  • Equities, still look cheap

  • Q3 GDP

    • NY Fed: 2.3% (+0.1%)

    • Atlanta Fed: 4.4% (+0.0%)