Oil and Gas Drilling a Game Changer for the Steel Industry

The Baker Hughes North American Rotary Rig Count is a weekly census of the number of drilling rigs actively exploring for or developing oil or natural gas in the United States and Canada. Rigs are considered active from the time they break ground until the time they reach their target depth and may be establishing a new well or sidetracking an existing one. The Baker Hughes Rotary Rig count includes only those rigs that are significant consumers of oilfield services and supplies. The number of rigs operating has a significant impact on the steel market especially for hot rolled coils.

The oil rig count peaked in August last year at 1,432 and by the September 20th count was down by 4.6 percent since then. This is still close to a high point for the last 2 ½ decades. Gas rig activity in contrast is down by 76 percent from its recent high point in September 2008, (Fig 1).