U.S. and Canadian energy firms cut the number of oil and natural gas rigs operating to a record low again this week even as higher oil prices prompt some producers to start drilling again.
In Canada, the oil and gas rig count fell by four this week to a fresh all-time low of 13, according to Baker Hughes. That was 111 rigs, or 90%, below this time last year.
The U.S. oil and gas rig count, an early indicator of future output, fell by one to an all-time low of 265 in the week to June 26, according to data from energy services firm Baker Hughes Co going back to 1940.That was 702 rigs, or 73%, below this time last year, and was the eighth week in a row the U.S. count set a fresh record low.
In June, the total U.S. rig count fell by 36, putting it down for a fourth month in a row.
U.S. oil rigs fell by one to 188 this week, their lowest since June 2009, while gas rigs held steady at 75, tying their lowest level on record, according to Baker Hughes data going back to 1987.
Even though oil prices are still down about 37% since the start of the year due to coronavirus demand destruction, U.S. crude futures have jumped 127% over the past nine weeks to around $38 a barrel on Friday on hopes global economies will snap back as governments lift lockdowns.
Analysts said those higher oil prices will encourage energy firms to slow rig count reductions and possibly start adding units later this year.