U.S. energy companies this week added oil rigs, with the monthly rig count rising for the first time since July as crude prices traded near their highest levels since the summer of 2015.
Drillers added nine oil rigs in the week to Nov. 22, bringing the total count up to 747, General Electric Co’s Baker Hughes energy services firm said in its closely followed report on Wednesday.
Baker Hughes released the rig count early this week due to the U.S. Thanksgiving Day holiday on Thursday. The report is also the last set of data released in November.
For the month, the number of active rigs increased by 10, after three months of declines.
The rig count, an early indicator of future output, is still much higher than a year ago when only 474 rigs were active after energy companies boosted spending plans for 2017 as crude started recovering from a two-year price crash.
The increase in drilling lasted 14 months before stalling in August, September and October after some producers started trimming their 2017 spending plans when prices turned softer over the summer. So far in 2017, U.S. crude futures have averaged about $50 a barrel, easily topping last year’s $43.47 average. This week, futures were trading around $58 a barrel, their highest since July 2015.
Looking ahead, futures were trading near $57 for calendar 2018 and $53 for calendar 2019 .
Energy consultancy Westwood Global Energy Group this week forecast an 18 percent increase in active rigs in 2018, but said U.S. output would climb even faster than implied by the rising oil rig count as producers become more productive per well.
Analysts at Simmons & Co, energy specialists at U.S. investment bank Piper Jaffray, this week revised higher their forecast for the total oil and natural gas rig count to an average of 874 in 2017, 927 in 2018 and 1,074 in 2019. Two weeks ago, it forecast 872 in 2017, 910 in 2018 and 1,059 in 2019.
There were 923 oil and natural gas rigs active on Nov. 22. The average number of rigs in service so far in 2017 was 871. That compares with 509 in 2016 and 978 in 2015. Most rigs produce both oil and gas.
(Reporting by Scott DiSavino Editing by Marguerita Choy)