Abundance of rigs slows down recovery of drilling market

Far more drilling rigs need to be taken out in order for the market to significantly improve, analyst Lukas Daul tells ShippingWatch. He projects that 150 rigs will leave the market in the coming years.

Photo: Bloomberg

Even though the number of drilling rigs has gone down in recent years, it is necessary to take out even more in order for the market to recover, analyst Lukas Daul of ABG Sundal Collier tells ShippingWatch.

Looking at the past 12 months alone, 31 rigs have disappeared from the market, according to a market update by Pareto Securities. Daul estimates that as many as 200 rigs have been taken out since the oil price plunge that began in 2014.

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