Oil and gas drilling activities in Louisiana jurisdictions and federal waters in the Gulf of Mexico slumped at the beginning of the year despite the Trump administration’s decision to reverse Biden-era leasing and environmental restrictions, a new report found.
The March report from the Louisiana Department of Natural Resources (LDNR) indicates that the energy exploration trends in the state mirror what’s happening nationwide. The study, which draws statistics from Baker Hughes Inc. (BHI), found that the average count for U.S. drilling rigs for February stood at 590, which is 32 rigs less than the number for February of 2024, reflecting a 5.1% decline.
The number of rigs exploring for crude oil around the United States in February was 14 less than the rig number in February of last year, according to the LDNR. And drop in rig activity for natural gas exploration nationwide was even greater in the year-over-year comparison.
In state jurisdiction areas, the decline in drilling activities was even more pronounced than the nationwide numbers. BHI found that in February, the Louisiana rig count was 32, a drop of 17 compared to the same time period last year, reflecting a 34.7% decrease. The number of rigs that focused on natural gas explorations declined by 12 in the year-over-year comparison, while oil rig activity in the state lands was down by five, the report says.
In the federal outer continental shelf region beyond Louisiana waters, the BHI reported an average rig count of 10 for February, which is nine rigs less than the activity in February 2024. All of those rigs were exploring for oil deposits, according to the report.
Mike Moncla, president of the Louisiana Oil & Gas Association, said that with respect to Louisiana’s offshore rigs, the long lead times needed for such projects can affect the numbers.
“Offshore projects are long-term plays, which is why it is important to have lease sales that allow for offshore exploration,” Moncla told the Louisiana Record in an email. “Oil prices under the Biden presidency were the highest in history, averaging about $80 per barrel. Since the election, prices have dramatically fallen into the low- to mid-$60’s.”
He also stressed that trends in the industry are driven by issues other than government regulations.
“I believe the term ‘Drill baby drill’ was a statement about taking the regulatory foot off of the throat of industry,” Moncla said. “However, the oil and gas industry has always been commodity price-driven; as those prices fall, profitability goes down with it and hence rig counts. There is uncertainty in the marketplace, so the decrease in the rig count is predictable.”
The Biden administration had put in place several oil-and-gas-related restrictions opposed by energy companies, including a plan to pause offshore oil lease sales in parts of the Gulf of Mexico and a ban on new export permits for liquefied natural gas. A federal court, however, stayed the ban on new LNG export permits last year.
Prices for natural gas in Louisiana have been on the rise in 2025, according to the LDNR report, climbing nearly 70% between February of last year and February of this year.
Meanwhile, the spot market price of Louisiana sweet crude oil has declined over the past year, falling from $79.48 per barrel in February of 2024 to $74.53 in February of this year, the report states.
The Trump administration’s tariffs on supply chains spanning from Mexico, Canada and elsewhere may also be adding to the cost of energy activities in the Gulf of Mexico, according to Offshore magazine. The tariffs may add to project expenses in the Gulf of up to 5% due to increased steel and equipment costs – with smaller firms feeling the biggest pinch if trade frictions escalate, the magazine reported.