U.S. energy firms this week added oil and natural gas rigs for a ninth week in a row to the highest since May, as producers return to the wellpad with crude prices mostly trading over $40 a barrel since mid June.
The oil and gas rig count, an early indicator of future output, rose 12 to 312 in the week to Nov. 13, energy services firm Baker Hughes Co said in its closely followed report on Friday.
That was 494 rigs, or 61%, below this time last year.
The total rig count fell to a record low of 244 during the week ended Aug. 14, while oil rigs alone fell to a 15-year low of 172 in the same week, according to Baker Hughes data going back to 1940.
U.S. oil rigs rose 10 to 236 this week, their highest since May, while gas rigs rose two to 73, according to Baker Hughes data.
U.S. crude rose to a 10-week high over $43 a barrel this week on hopes of an effective coronavirus vaccine.
Even though the oil contract was down about 34% since the start of the year, it was still up about 115% over the past seven months on hopes global economies and energy demand will return when governments lift coronavirus lockdowns.
U.S. crude production has recovered from the two-and-a-half-year lows touched in May mainly because shale producers have brought wells back online in response to rising prices.
However, production is expected to fall by 860,000 barrels per day (bpd) this year to 11.39 million bpd, and drop a further 290,000 bpd next year to 11.1 million bpd, the U.S. Energy Information Administration (EIA) said on Tuesday.
The EIA expects production to decline in the second quarter of 2021 because new drilling activity will not generate enough production to offset declines from existing wells. Drilling activity will rise later in 2021, it forecast.29dk2902l