U.S. energy firms this week added the biggest number of oil and natural gas rigs in a week since September, with the oil rig count also rising to its highest in six months, energy services firm Baker Hughes said in its closely followed report on Friday.
The oil and gas rig count, an early indicator of future output, rose by seven to 629 in the week to March 15.
Despite this week’s rig increase, Baker Hughes said the total count was still down 125 rigs or 16.6% below this time last year.
Baker Hughes said oil rigs rose six to 510 this week, their highest since September, while gas rigs rose one to 116.
The oil and gas rig count dropped about 20% in 2023 after rising by 33% in 2022 and 67% in 2021, due to a decline in oil and gas prices, higher labor and equipment costs from soaring inflation and as companies focused on paying down debt and boosting shareholder returns instead of raising output.
U.S. oil futures were up over 13% so far in 2024 after dropping by 11% in 2023. U.S. gas futures, meanwhile, were down about 33.7% so far in 2024 after plunging by 44% in 2023.
Despite lower prices, spending and rig counts, U.S. oil and gas output was still on track to hit record highs in 2024 and 2025 due to efficiency gains and as firms complete work on already drilled wells.
(Reporting by Scott DiSavino in New York and Anjana Anil in Bengaluru Editing by Marguerita Choy)