U.S. energy firms this week resumed cutting the number of oil and natural gas rigs after adding rigs last week, with the count falling for a fifth week in six, energy services firm Baker Hughes said in its closely followed report on Sept. 20.

The oil and gas rig count, an early indicator of future output, fell by two to 588 in the week to Sept. 20. 

Baker Hughes said that puts the total rig count down 42 rigs, or 7%, below this time last year.

Baker Hughes said the number of oil rigs was unchanged at 488 this week, while gas rigs fell by one to 96.

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 more on paying down debt and boosting shareholder returns than raising output.

U.S. oil futures were up about 0.6% so far in 2024 after dropping by 11% in 2023, while U.S. gas futures were down about 4% so far in 2024 after plunging by 44% in 2023.

The CEO of EQT, the largest U.S. gas producer, sees prices for the fuel remaining below $3 per million British thermal units in the short term.

EQT, which earlier this year curtailed production as prices fell to multi-year lows, expects curtailments to ease by next year on demand for liquefied natural gas exports. Several rival U.S. shale gas producers also cut drilling to stem overproduction.

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