The oil and gas rig count, an early indicator of future output, rose 13 to 373 in the week to Jan. 15, its highest since May, energy services firm Baker Hughes Co said in its closely followed report on Friday.
Those eight weeks of additions were the most since November when the rig count climbed for nine weeks in a row. Despite gains in recent months, that count was still 423 rigs, or 53%, below this time last year.
U.S. oil rigs rose 12 to 287 this week, their highest since May, while gas rigs gained one to 85, their highest since April, according to Baker Hughes data.
More than half the U.S. oil rigs are in the Permian basin in West Texas and eastern New Mexico where total units rose 10 to 189 this week, the most since May. That was the biggest weekly gain in the basin since August.
U.S. crude futures climbed to almost $54 per barrel this week, their highest since February 2020.
Those higher prices have already encouraged energy firms to drill much more since the total rig count plunged to a record low of 244 in August 2020, according to Baker Hughes data going back to 1940.
“While we don’t expect recent oil price momentum to have a dramatic (upward) impact on the cadence of rig adds from here… we do still see further activity upside and continue to expect to exit 2021 at roughly 400 horizontal rigs working,” analysts at Tudor, Pickering, Holt & Co said in a note.29dk2902l