September 14, 2024
US rig count trends are split between horizontal and vertical drilling trajectories from 2012 to H1 2024.
Horizontal Drilling peaked in 2014 at over 800 rigs declining to about 200 rigs in 2016. Drilling recovered post 2016 through 2019 before dropping again to just over 165 rigs due to the Covid pandemic. The horizontal rig count recovered again after 2020 ending H1 2024 at over 400.
Vertical Drilling was at about 360 rigs in 2012, the highest in the past 14+years. Again, the impact of the Covid pandemic saw vertical rigs drop to just 1 in 2020. The vertical rig count did not experience much recovery post 2020 with 2024 counts just over 10.
The two significant downturns in drilling in 2015/16 and 2020 were due to a crash in crude oil prices and the impact of the covid pandemic, respectively. The general overall downward trend following each drop can be attributed to increased horizontal drilling which yields more production than vertical wells due to long laterals and more frac stages.