Sunday, September 27, 2009

Natural Gas Rig Count up to 710

NEW YORK, Sept 25 (Reuters) - The number of rigs drilling for natural gas in the United States climbed five this week to 710, according to a report on Friday by oil services firm Baker Hughes in Houston.

The U.S. natural gas drilling rig count has gained in nine of the last 10 weeks but is still down sharply since peaking above 1,600 in September last year, standing at 849 rigs, or 54 percent, below the same week last year.

During the week ended July 17, 2009, the natural gas rig count dipped to 665, its lowest level since May 3, 2002, when there were 640 gas rigs operating.

Tighter access to credit and a 70 percent slide in natural gas prices since last summer to about $3.50 per mmBtu forced many producers to scale back gas drilling operations.

The steep declines in drilling this year have started to slow production and tighten supplies, but most traders agreed it has not been enough yet to offset concerns about record high inventories and recession-related cuts in demand, particularly from the industrial sector. (Reporting by Joe Silha; Editing by Christian Wiessner)

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