The industry’s advance beyond the rig count indicating production growth has complicated things for forecasters. Every Friday, the Baker Hughes oil and natural gas rig count gets released. This is vital field information that energy analysts eagerly await. In essence, the count is supposed to convey the current thinking of the U.S. oil and gas industry. As it is supposed to go, higher oil prices mean higher rig counts which mean higher production. And in the opposite direction, lower prices mean less rigs and falling production. While it is true that more rigs usually enter the fields when prices go up, it can take months of higher prices before drillers are confident enough to bring additional rigs into service. And there is also a lag time with dropping prices, not immediately dragging the rig count lower. Many times lower prices just mean removing the less efficient rigs from the […]