U.S. energy firms added oil and gas rigs for a second year in a row for the first time since 2018, energy services firm Baker Hughes Co said in its report on Friday.
That puts the total rig count up to 779 rigs, or about 33% higher than this time last year, Baker Hughes said.
The U.S. oil and gas rig count, an early indicator of future output, was unchanged in the week to Dec. 30.
U.S. oil rigs fell 1 to 621 this week, while gas rigs rose 1 to 156, their highest since the week ending Nov. 18.
For the month, the total rig count declined for the first time since August.
For the quarter, the total rig count rose for a ninth quarter in a row, the most since 2011.
U.S. oil futures were up about 5% so far this year after soaring 55% in 2021.
Even though several energy firms have boosted spending for a second year in a row in 2022 after cutting drilling and completion expenditures in 2019 and 2020, crude production has remained below record levels seen in 2019.
That’s because many energy companies are focusing more on returning money to investors and paying down debt rather than boosting output.
U.S. crude production was on track to rise from 11.25 million barrels per day (bpd) in 2021 to 11.87 million bpd in 2022 and 12.34 million bpd in 2023, according to federal energy data. That compares with a record 12.32 million bpd in 2019.
In addition, some analysts noted that energy firms did not use this year’s increase in capital spending to boost production but instead spent the money on more expensive equipment and rising labor costs due to soaring inflation and supply disruptions.