U.S. energy firms this week kept the number of oil and natural gas rigs virtually unchanged, energy services firm Baker Hughes said in its closely followed report on Friday. The rig count including a miscellaneous category, an early indicator of future output, was steady at 549 in the week to October 3. Baker Hughes said the total count was down 36 rigs, or 6.2% below this time last year.
Baker Hughes said oil rigs fell by two to 422 this week, while gas rigs rose by one to 118.
The oil and gas rig count declined by about 5% in 2024 and 20% in 2023 as lower U.S. oil and gas prices over the past couple of years prompted energy firms to focus more on boosting shareholder returns and paying down debt rather than increasing output. Even though analysts forecast U.S. spot crude prices would decline for a third year in a row in 2025, the U.S. Energy Information Administration (EIA) projected crude output would rise from a record 13.2 million barrels per day (bpd) in 2024 to around 13.4 million bpd in 2025.
On the gas side, EIA projected a 61% increase in spot gas prices in 2025 would prompt producers to boost drilling activity this year after a 14% price drop in 2024 caused several energy firms to cut output for the first time since the COVID-19 pandemic reduced demand for the fuel in 2020. EIA projected gas output would rise to 106.6 billion cubic feet per day (bcfd) in 2025, up from 103.2 bcfd in 2024 and a record 103.6 bcfd in 2023.
(Reporting by Scott DiSavino and Sarah Qureshi in Bengaluru;)