Source: Day Rate Report | January 2017

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US land rig day rates on average—aggregated across all rig classes and all regions—rocketed up by 2% in January, reported the January issue of Platts RigData’s Day Rate Report. That’s the biggest increase in this metric seen since May 2013.

Together with a respectable gain of +0.7% in December, the Platts RigData News & Analysis team is ready to say that a full-fledged recovery in day rates is finally under way. The team even suggests that the surprising scope of the day rate increase is an early sign of cost inflation in the oilfield services sector, which has been slammed brutally during the downturn. It’s still early in the quarter, but looking at the average day rate changes quarter-to-quarter, Q1 of 2017 is up by +2.3%.

Even with the massive losses of the past 2 years, however, overall day rate values today are still up by a net cumulative 28% from 2009, reflecting the dominance of larger rigs (1,000–2,000 hp) in drilling over the past decade.

Call 1-800-627-9785 to subscribe to RigData’s Day Rate Report, the exclusive monitor of U.S. drilling contractor day rates.

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