The U.S. oil and gas rig count, an early indicator of future output, fell by five to an all-time low of 258 in the week to July 10, according to data on Friday from energy services firm Baker Hughes Co going back to 1940.
That was 700 rigs, or 73%, below this time last year.
U.S. oil rigs fell by four to 181 this week, their lowest since June 2009, while gas rigs dropped by one to 75, matching its record low hit a couple of weeks ago, according to data going back to 1987.
More than half of the total U.S. oil rigs are in the Permian basin in West Texas and eastern New Mexico, where active units dropped by one this week to a fresh record low of 125, according to data going back to 2011.
The U.S. Energy Information Administration (EIA) projected a fall in domestic crude output to 11.6 million barrels per day (bpd) this year from a record 12.2 million bpd in 2019, while global petroleum and other liquid fuels consumption will drop to 92.9 million bpd in 2020 from a record 101.0 million bpd in 2019.
Even though U.S. oil prices are still down about 34% since the start of the year due to coronavirus demand destruction, U.S. crude futures have jumped 113% over the past three months to around $40 a barrel on Friday on hopes global economies will snap back as governments lift lockdowns.
Analysts said higher oil prices will encourage energy firms to slow rig count reductions and possibly start adding some units later this year.