Oil Boom

In 1988, the number of active oil rigs was just under 600. They slowly decreased over the next 12 years till they hit an average low of 150-160. That's an 67% reduction. Over the next 8 years or so, they steadily climbed under the Bush Energy Policy to a level about 200% of the year 2000 average. However, since 2008, they have sky-rocketed. Active oil rigs are now more than double of the 1988 levels--and triple the end of the Bush era count.

Similarly, crude oil prices decreased from 1980 to 1998. They started to increase from 2000 to the present, peaking in 2008 at 800% of their 1998 prices. Oil rigs have increased 800% also. Correlation? You bet. Cause and effect? Most likely. Oil prices are currently about 300% of 1998 prices while the rig count is about 400% of those levels.

What has the meant for domestic oil production? 8.5 million barrels/day in 1988, decreasing only 37% to the low in 2006 - 2008. The active rigs in those 20 years were more productive than the ones shut down during that period.

• In 1988, the average rig output was 14,000 barrels/day. 
• In 1998, it was 43,000 barrels/day. 
• In 2008, it was under 14,000 barrels/day.
• In 2013, it seems to be 5,000 barrels/day.

We are producing more domestic oil than we did almost 20 years ago, but at what cost? Is it the low production that's keeping the prices high? Are the "new" active wells (less than 5 years old) less efficient, productive? I believe the Baker Hughes counts is active, productive units and not ones in the midst of "completion" (getting ready for production) because the count they're providing is meant to give oil service supply companies an indication of potential business. Are the new sources of oil not plentiful enough to create highly productive wells (like in 1998)?

I'm sure someone knows the answers. I just have questions.