Rig Counts Respond to Rapid Recovery in WTI!
April 6, 2021 Article by Jeffrey PriceDefying all but the most optimistic forecasts, the US-based West Texas Intermediate prices have soared by 22% since ’20 closing price of $48.52.
![](https://www.1keystone.com/wp-content/uploads/2021/04/WTI-Closing-Prices-010220-033121-1024x650.png)
This dramatic surge is attributed to optimism about an early wind-down of the pandemic-driven contractions and unexpected discipline on the parts of both OPEC+, and more surprisingly, the US shale industry centered here in the Permian.
Hence, growth rates in US-based production are way slower than compared to recent post-recession patterns. The upshot: Rig counts are up, but they have an awfully long way to go before they get near the frenzied levels of 2018 (and early 2019).
![](https://www.1keystone.com/wp-content/uploads/2021/04/Rig-Count-Table.033121.png)
![](https://www.1keystone.com/wp-content/uploads/2021/04/Rig-Count-Reeves-vs.-US-033121-696x1024.png)
![](https://www.1keystone.com/wp-content/uploads/2021/04/Rig-Counts-Cumulative-Growth.033121-1024x741.png)
This lack of a fast rebound is said to reflect more “capital discipline” on the parts of producers and their suppliers.
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