In spite of continued OPEC+ cuts constraining supply, oil prices continued an overall downward trend from 2023, with WTI posting a 1.2% decrease to an average of $76.63/bbl in 2024. Brent, meanwhile, saw a similar dip in 2024 of 2.4%, averaging out to $80.52/bbl. Accordingly, there was a lowered rate of U.S. drilling activity that can be attributed to a number of factors, including the aforementioned OPEC+ cuts, lowered oil prices, and general trends of fiscal discipline by operators.
Despite a push for “drill, baby, drill,” by President Donald Trump during his campaign, U.S. activity continued to contract in 2024, leaving the most recent peak of 2022 far behind. Total rig count average for 2024 dipped 12.8% from 2023’s 687 rigs, down to 599 total rigs. U.S. production, meanwhile, posted a 2,7% increase from 2023, averaging out to 13.28 MMbpd in 2024.
Activity in 2024 vs 2023. The count started 2024 at 621 rigs and fluctuated around that number for 14 weeks before beginning a small but steady decline in March that culminated in a low point of 581 on June 28. The count rebounded slightly in the remaining months, fluctuating around the mid-to-high 580s before finishing the year at 599 total rigs.
Among the four largest producing states, all of them saw reductions in rig count of varying degrees. Texas saw a significant 15.3% drop from 2023 to 2024, with the final 2024 average coming out to 287 units, rounding up. The decline can be attributed mainly to losses in districts 6 and 8, though every district, aside from 9 and 7C, showed losses. Louisiana, meanwhile, experienced a 22.8% drop, with North Dakota and New Mexico posting milder decreases, at 6.2% and 1.1%, respectively.
Looking specifically at the gas sectors in the four major states, Texas District 6 posted an 11-unit decline, averaging out to 17 rigs for 2024. Lousiana’s Haynesville shale showed a milder but still substantial drop, down nearly eight units to average 24 rigs for 2024. New Mexico’s Permian basin area, meanwhile, came out to an average 101 units for 2024, down slightly from 2023’s average. In North Dakota, activity only declined slightly, albeit for a smaller number of rigs than the other three, coming out to an average 33 rigs for 2024.
Offshore. Activity offshore Louisiana showed a slight decrease, losing one unit, while Alaska has a small dip, as well. The decline shows a steady trend continued from previous years, driven largely by historical attitudes and policy decisions regarding the industry. California, however, posted a two-rig gain in the offshore sector for 2024, despite a historically poor political and regulatory climate for drilling activity.
Natural gas regions. In the Marcellus-Utica plays, activity also saw declines at higher rates than overall activity. Gas prices were slow to recover in 2024, despite a promising end to the year. Pennsylvania was down 14% from 2023, to an average 19 rigs, while West Virginia saw a 34.7% drop (in a small number of units) to 8 rigs. Finally, Ohio suffered the smallest loss of 9.4%, down to an average of about 11 rigs in 2024.
U.S. DUC count declines in oil regions. Reduced activity has resulted in declining DUC inventories across various U.S. regions over the last 12 months. According to the EIA, the total DUC count for December 2024 came to 5,263 wells—a substantial 633-well reduction (-10.7%) compared with the final 5,896 count for December 2023. The decrease was shared by all regions, although the Eagle Ford showed the greatest reduction, down to 295 units from 2023’s 542 wells (-45.6%). The Bakken and Permian were close behind with 16.8% and 13.9% reductions, respectively. WO