It was the worst year for oil exploration since George Bush blew up his fledgling oil business back in 1988. I suppose one could make the argument that a decline in drilling activity of this magnitude can only mean that the price of oil is nearing a bottom. The only problem with that theory is the House of Saud’s financial jihad, upping their oil production into the teeth of a cataclysmic oil decline and glut.
Rigs targeting crude in the U.S. fell by 2 to 536 in the past week, Baker Hughes Inc. said on its website Thursday. Natural gas rigs were unchanged at 162, bringing the total of working rigs to 698. Drillers searching for oil idled 59 percent of their rig fleet this year, the steepest annual cut since at least 1988.
The downward slide in working rigs probably will continue into the new year, crimping output from shale fields by at least 400,000 barrels a day, Andrew Cosgrove and William Foiles, analysts at Bloomberg Intelligence, said in a Dec. 28 report. Rigs designed to drill straight down into traditional fields have been hit harder than those capable of boring sideways through shale, Baker Hughes’ data showed.
For the most part, oil and gas stocks were halved in 2015, aside from the few companies who smartly hedged before the meltdown.
The best performing oil and gas stocks of 2015 were: GNE (+77%), CPE (+53%), ERN (+47%), PDCE (+32%), NFX (+15), FANG (+12%).
Almost ever other oil and gas stock traded lower.
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I wonder how many half-wits out there bought FANG when reading all the headlines about “FANG” in the second half of the year. Probably more than we could imagine.
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