Oil rigs in the United States saw their steepest cuts since February 2015 as crude prices more than halved since the start of the year despite fresh global efforts by producers to cut output to counter a glut triggered by demand destruction from the coronavirus pandemic.

Drillers cut 66 oil rigs in the week to April 17, bringing the total count down to 438, the lowest since October 2016, energy services firm Baker Hughes said in its closely followed report on Friday.

The oil rig count, an early indicator of future output, is down 47% from the same week a year ago when 825 oil rigs were active.

Analysts at Raymond James projected total U.S. oil and natural gas rigs would collapse from around 800 at the end of 2019 to a record low of around 400 by the middle of the year and around 200 at the end of 2020. The investment bank forecast the rig count would average a mere 225 rigs in 2021.

That compares with the current all-time low of 404 rigs during the week ended May 20, 2016, according to Baker Hughes data going back to 1940.

In Canada, meanwhile, the total oil and gas rig count fell to 30, the lowest since at least 2000, according to Baker Hughes data going back that far. The prior all-time low was 29 rigs during the week ended April 24, 1992.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, last weekend agreed to reduce crude output to stop oil prices from falling as governments around the world attempt to slow the pandemic with lockdowns that are also crimping economic growth and energy demand.

U.S. crude futures (CLc1) traded around $25 per barrel on Friday, ahead of its April 21 expiration as investors rapidly switched out of that contract into June futures.

Also, weak Chinese economic figures and rapidly filling U.S. crude storage offset bullishness built on U.S. President Donald Trump’s outlines for the U.S. economy to emerge from the coronavirus shutdown.

Last updated on Sat., April 18, 2020.