Canadian Drilling – One Way Ticket to Dullsville

For the week of October 3, Baker Hughes reported that the Western Canadian gas-directed rig count was unchanged at 60 for a third consecutive week (blue line and text in left hand chart below), three less than one year ago and at its lowest level for this time of year since 2020. The oil-directed rig count was also unchanged, holding at 128 for a second week (red line and text in right hand chart), 27 less than a year ago and is the highest since the second week of March. Drilling activity has continued to trend sideways due to increased caution exercised by producers over capital spending programs as crude oil prices have been stagnant and Western Canadian natural gas cash prices have recently experienced record lows.