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U.S. oil exploration and production slowing down

Staff Writer |
While higher than last year, a survey of U.S. exploration and production activity in October suggests the sector may go into hibernation during the winter.

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The analytics division of commodity pricing group S&P Global Platts recorded 1,033 rigs in active service in the United States last month, down about 1 percent from the previous month.

Rig counts serve as a metric for activity geared toward exploration and production and serve as a loose barometer to gauge sector confidence.

Rig counts plummeted last year under strains from lower crude oil prices, but have since recovered on improved market conditions.

The price for West Texas Intermediate, the U.S. benchmark for the price of oil, was near $55 per barrel early Friday, up by almost 23 percent from this date last year. The October rig count is up 62 percent from last year.

Crude oil prices have been rallying for most of the quarter, with very few day-to-day declines recorded over the past few weeks. U.S. markets were idled by hurricanes for part of last month, though Trey Cowan, an industry analyst at Platts, said he was surprised market forces weren't enough to bring net gains in exploration and production.

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