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Monthly Update: Rig Count

October '23, Latest Data
Published on 10/17/23

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Estimated Read Time: 2 minutes

The Baker Hughes count of active domestic rotary rigs slipped to 622 in mid-October, down from 769 the same week in ’22. The count peaked at 784 the week of November 23, 2022, and has trended down since. The rig count now stands at the same place it was in early February ’22.

Despite the drop in the rig count, output continues to climb. The U.S. Energy Information Administration estimates U.S. production to hit 12.991 million barrels per day in July (latest data available), the second-highest monthly production on record. The previous peak was 13.0 million barrels in November ’19. More efficient drilling techniques, longer laterals (the horizontal portion of a well), and a better understanding of the underlying geology have helped firms increase their output. The U.S. production is likely to top 13.0 million barrels this year.

West Texas Intermediate (WTI), the U.S. benchmark for light, sweet crude, averaged $89.42 in September, up from $81.38 in August and $76.06 in July. The first two weeks of October, WTI averaged $85.65.

Saudi Arabia and Russia have spearheaded deep output cuts to drain inventories and boost prices. Their voluntary curbs have augmented a broader collective OPEC+ deal to pare production. The conflict between Israel and Hamas initially caused oil prices to jump, but weak gasoline demand and higher than anticipated inventory levels quickly brought down prices.

In its October ’23 Short-Term Energy Outlook, the U.S. Energy Information Administration (EIA) forecasts WTI to trade around $86 per barrel through the end of this year and between $89 and $92 per barrel in ’24.  The situation in Israel developed after EIA ran its models, so the conflict remains a source of uncertainty in the agency’s forecasts.


The spot price for natural gas at the Henry Hub averaged $2.64 per million British thermal units (MMBtu) in September, down 66.5 percent from $7.88 in September last year. Last year’s run-up in prices was driven by colder-than-normal winter temperatures in the U.S., electric utilities limited ability to switch from natural gas to coal, and Russia cutting off natural gas exports to Europe.  Since February of this year, natural gas has traded for $3.00 or less per MMBtu.

EIA expects U.S. natural gas inventories to total 3,854 billion cubic feet, 6% more than the five-year (’18 – ’22) average for the end of October. EIA forecasts U.S. natural gas exports to hit a record 12.8 billion cubic feet per day (Bcf/d) in ‘23 and for growth to continue in ’24. Increases in liquefied natural gas (LNG) exports and pipeline exports to Mexico will drive the overall increase. 

Prepared by Greater Houston Partnership Research Department

Patrick Jankowski, CERP
Chief Economist
Senior Vice President, Research

Leta Wauson
Research Director

Energy Key Economic Indicators

Active domestic rotary rigs averaged 622 in mid-October '23

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