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No change in North Dakota rig count

No. 2 oil producer in the United States steady amid oil price volatility.

By Daniel J. Graeber
No change in North Dakota rig count
No movement in rig deployments in shale-rich North Dakota amid volatility in crude oil prices. Photo by Lilac Mountain/Shutterstock

BISMARCK, N.D., June 20 (UPI) -- The number of rigs actively working on the shale basins of North Dakota was unchanged from last week despite a major late-week rally in oil prices, data show.

Data show 28 rigs actively exploring for or producing oil and natural gas in North Dakota as of Monday, unchanged from the previous week. North Dakota is the No. 2 oil producer in the United States.

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Rig count figures offer a loose gauge of the health of the energy sector as fluctuations in those numbers usually mirror movements in crude oil prices. Higher crude oil prices bring more capital for companies to invest in exploration and production and can lead to higher rig deployments.

Crude oil prices rallied more than 4 percent during Friday trading after oil services company Baker Hughes showed a 2.4 percent increase in North American rigs from the week ending June 10. Oil prices, however, have been relatively stable despite the short-term movement.

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West Texas Intermediate, the U.S. benchmark price for crude, was trading at around $48.80 before the opening bell Monday in New York. WTI opened one week ago at around $48.30, a difference of less than 1 percent.

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Baker Hughes data show a 7 percent increase in rig activity in Texas, the No. 1 oil producer in the United States, from the week ending June 10.

The North Dakota Industrial Commission reported total crude oil production in April, the last full month for which data are available, at 1.04 million barrels per day, about 6.3 percent lower than March and 15 percent below the all-time high of 1.23 million bpd reported in December 2014.

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After setting a record in March, natural gas production dropped 5.5 percent as the drop in oil prices meant companies had less capital to invest in exploration and production.

In a report last week, Lynn Helms, the director of a North Dakota oil and gas commission, said a slowdown in the state energy sector is expected "to last into at least the third quarter of this year and perhaps into the second quarter of 2017."

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