Oil, gas rigs added for seventh consecutive month

U.S. energy firms this week added oil and natural gas rigs for a seventh month in a row, but the rate of growth slowed in February even as oil prices rose to their highest since 2019.

The oil and gas rig count, an early indicator of future output, rose five to 402 in the week to Feb. 26, its highest since May, energy services firm Baker Hughes Co. said in its weekly report. The count is up 4% in the last month but still down 46% year-over-year.

Since the start of 2021, more than 60 rigs have been added in the U.S. BP  Plc has had the largest increases since Jan. 1, adding five rigs—four in the Eagle Ford Shale alone—and bringing its total to 12.

After falling to record lows below zero in April 2020 due to weakened demand from the coronavirus, WTI crude futures in the U.S. have climbed over $63/bbl this week and hit their highest since 2019.

Most energy firms said they plan to keep spending flat in 2021 with 2020 levels as they focus on boosting cash flow and reducing debt rather than increasing output. U.S. financial services firm Cowen & Co. said the 45 independent E&P companies it tracks plan to keep spending flat in 2021 versus 2020. That follows capex reductions of roughly 49% in 2020 and 12% in 2019.