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More Rigs in Action: Are EOG & MTDR Stocks Must Watch Now?
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In its last weekly release, Baker Hughes Company (BKR - Free Report) stated that the U.S. rig count was higher than the prior week’s figure. The rotary rig count, issued by BKR, is usually published in major newspapers and trade publications.
Baker Hughes’ data, issued at the end of every week since 1944, helps energy service providers gauge the overall business environment of the oil and gas industry. The number of active rigs and its comparison with the week-ago figure indicates the demand trajectory for the company’s oilfield services from exploration and production companies.
With the weekly rig count rising, should investors keep an eye on leading oil and gas exploration companies like EOG Resources Inc. (EOG - Free Report) and Matador Resources Company (MTDR - Free Report) ? Before diving into that, let's explore the latest rig count data details.
Baker Hughes’ Data: Rig Count in Detail
Total U.S. Rig Count Rises: The number of rigs engaged in the exploration and production of oil and natural gas in the United States was 589 in the week ended Dec. 6, higher than the week-ago count of 582. The current national rig count, however, declined from the year-ago level of 626, reflecting the fact that there has been a slowdown in drilling activities. Some analysts see this downside as a sign of increased efficiency among shale producers, who may need fewer rigs. However, there are doubts among a few about whether certain producers have sufficient promising land for drilling.
Onshore rigs in the week that ended on Dec. 6 totaled 572, higher than the prior week's count of 567. In offshore resources, 15 rigs were operating, higher than the week-ago count of 13.
U.S. Oil Rig Count Rises: The oil rig count was 482 in the week ended Dec. 6, higher than the week-ago figure of 477. The current number of oil rigs — far from the peak of 1,609 attained in October 2014 — was, however, down from the year-ago figure of 503.
U.S. Natural Gas Rig Count Increases: The natural gas rig count of 102 exceeded the week-ago figure of 100. However, the count of rigs exploring the commodity was below the year-ago week’s tally of 119. Per the latest report, the number of natural gas-directed rigs is almost 94% lower than the all-time high of 1,606 recorded in 2008.
Rig Count by Type: The number of vertical drilling rigs totaled 14 units, lower than the week-ago count of 16. However, the 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 575 was higher than the prior-week level of 566.
Rig Tally in the Most Prolific Basin
Permian — the most prolific basin in the United States — recorded a weekly oil and gas rig count of 304, increased from the week-ago figure of 303. The count was, however, below the prior-year level of 313.
Handsome Oil Price Supports Upstream: EOG, MTDR to Gain
West Texas Intermediate (WTI) crude is currently trading at more than $67 per barrel, presenting an advantageous landscape for exploration and production. Despite moderation in drilling activity as upstream companies prioritize stockholder returns over production growth, the favorable pricing environment benefits energy producers. U.S. oil and gas companies gain from significantly lower breakeven WTI prices across all shale plays, particularly for existing wells. Furthermore, the average breakeven price for most new wells remains below current market levels, positioning upstream players for continued profitability in the current environment.
Breakeven WTI Price for US Producers
Image Source: Statista
Given the current landscape, there are opportunities for additional rigs to be added in shale plays. With profitable exploration and production operations, investors looking for medium to long-term gains should consider keeping an eye on energy stocks such as EOG Resources and Matador Resources.
In the United States, EOG Resources is one of the foremost explorers and producers of oil and gas, with its crude reserves spanning across the United States and Trinidad. The company, carrying a Zacks Rank #3 (Hold), possesses an extensive inventory of high-quality drilling wells in low-cost, premium resources, ensuring a strong business outlook.
Matador's focus on record production and cost-saving techniques is driving higher profitability per barrel and reducing overall expenses, creating a solid foundation for sustained long-term growth. The recent acquisition of Ameredev assets and their rapid, successful integration — resulting in additional production and lower costs — highlights Matador's operational efficiency. Furthermore, proceeds from the sale of Piñon Midstream are expected to strengthen the financial flexibility of MTDR, which carries a Zacks Rank #3, by reducing leverage ratios. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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More Rigs in Action: Are EOG & MTDR Stocks Must Watch Now?
In its last weekly release, Baker Hughes Company (BKR - Free Report) stated that the U.S. rig count was higher than the prior week’s figure. The rotary rig count, issued by BKR, is usually published in major newspapers and trade publications.
Baker Hughes’ data, issued at the end of every week since 1944, helps energy service providers gauge the overall business environment of the oil and gas industry. The number of active rigs and its comparison with the week-ago figure indicates the demand trajectory for the company’s oilfield services from exploration and production companies.
With the weekly rig count rising, should investors keep an eye on leading oil and gas exploration companies like EOG Resources Inc. (EOG - Free Report) and Matador Resources Company (MTDR - Free Report) ? Before diving into that, let's explore the latest rig count data details.
Baker Hughes’ Data: Rig Count in Detail
Total U.S. Rig Count Rises: The number of rigs engaged in the exploration and production of oil and natural gas in the United States was 589 in the week ended Dec. 6, higher than the week-ago count of 582. The current national rig count, however, declined from the year-ago level of 626, reflecting the fact that there has been a slowdown in drilling activities. Some analysts see this downside as a sign of increased efficiency among shale producers, who may need fewer rigs. However, there are doubts among a few about whether certain producers have sufficient promising land for drilling.
Onshore rigs in the week that ended on Dec. 6 totaled 572, higher than the prior week's count of 567. In offshore resources, 15 rigs were operating, higher than the week-ago count of 13.
U.S. Oil Rig Count Rises: The oil rig count was 482 in the week ended Dec. 6, higher than the week-ago figure of 477. The current number of oil rigs — far from the peak of 1,609 attained in October 2014 — was, however, down from the year-ago figure of 503.
U.S. Natural Gas Rig Count Increases: The natural gas rig count of 102 exceeded the week-ago figure of 100. However, the count of rigs exploring the commodity was below the year-ago week’s tally of 119. Per the latest report, the number of natural gas-directed rigs is almost 94% lower than the all-time high of 1,606 recorded in 2008.
Rig Count by Type: The number of vertical drilling rigs totaled 14 units, lower than the week-ago count of 16. However, the 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 575 was higher than the prior-week level of 566.
Rig Tally in the Most Prolific Basin
Permian — the most prolific basin in the United States — recorded a weekly oil and gas rig count of 304, increased from the week-ago figure of 303. The count was, however, below the prior-year level of 313.
Handsome Oil Price Supports Upstream: EOG, MTDR to Gain
West Texas Intermediate (WTI) crude is currently trading at more than $67 per barrel, presenting an advantageous landscape for exploration and production. Despite moderation in drilling activity as upstream companies prioritize stockholder returns over production growth, the favorable pricing environment benefits energy producers. U.S. oil and gas companies gain from significantly lower breakeven WTI prices across all shale plays, particularly for existing wells. Furthermore, the average breakeven price for most new wells remains below current market levels, positioning upstream players for continued profitability in the current environment.
Breakeven WTI Price for US Producers
Image Source: Statista
Given the current landscape, there are opportunities for additional rigs to be added in shale plays. With profitable exploration and production operations, investors looking for medium to long-term gains should consider keeping an eye on energy stocks such as EOG Resources and Matador Resources.
In the United States, EOG Resources is one of the foremost explorers and producers of oil and gas, with its crude reserves spanning across the United States and Trinidad. The company, carrying a Zacks Rank #3 (Hold), possesses an extensive inventory of high-quality drilling wells in low-cost, premium resources, ensuring a strong business outlook.
Matador's focus on record production and cost-saving techniques is driving higher profitability per barrel and reducing overall expenses, creating a solid foundation for sustained long-term growth. The recent acquisition of Ameredev assets and their rapid, successful integration — resulting in additional production and lower costs — highlights Matador's operational efficiency. Furthermore, proceeds from the sale of Piñon Midstream are expected to strengthen the financial flexibility of MTDR, which carries a Zacks Rank #3, by reducing leverage ratios. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.