Oil producers in one of US states intend to cut back on drilling due to falling prices

As reported by Reuters with a reference to the Department of Mineral Resources of North Dakota, US, oil and gas producers of the state are going to cut the number of drilling rigs and production crews due to falling oil prices. The department estimates that this is likely to affect hydrocarbon production in the United States' third-largest oil-producing region.

Companies have already begun to reduce production and cut back on drilling rigs after prices fell below $65, the price needed to break even in business.

Historically, that value for North Dakota has been in the range of $55 to $60 a barrel, said the department's director Nathan Anderson. He noted that the number of rigs in the state will decrease slightly amid the volatile price environment. About four or five companies have plans to reduce the number of drilling units either as part of their business plans or because of low prices, according to the official.

By August, the number of drilling rigs in North Dakota is likely to drop to 27, he added. As of May 16, the current number of drilling rigs in the state was 31.