Rig shortage to stunt oil output growth for years

LONDON (Reuters) – A global shortage of rigs will hamper attempts to raise global oil and gas output for years, oil service company executives and consultants said on Monday.

As producers look to boost crude and gas output to meet soaring demand growth, the global supply of rigs is stretched to the limit and is insufficient to meet industry needs.

“To get up to speed to meet the drilling needs of the industry, it’s going to take a lot of time,” said Pete Miller, Chief Executive of oil drilling equipment maker National Oilwell Varco.

Many rigs in service need to be replaced, Miller told an oil industry conference in London. He said the average age of rigs worldwide is now older than the average age at which they would typically be scrapped.

Reuters