U.S. energy firms this week added oil and natural gas rigs for a ninth week in a row to the highest since May, as producers return to the well pad with crude prices mostly trading over $40 per barrel since mid-June.
The oil and gas rig count, an early indicator of future output, rose 12 to 312 in the week to Nov. 13, energy services firm Baker Hughes Co. said in its weekly report. That was 494 rigs, or 61%, below this time last year.
The total rig count fell to a record low of 244 during the week ended Aug. 14, while oil rigs alone fell to a 15-year low of 172 in the same week, according to Baker Hughes data going back to 1940.
U.S. oil rigs rose 10 to 236 this week, their highest since May, while gas rigs rose two to 73, according to Baker Hughes data.
U.S. crude rose to a 10-week high over $43 per barrel this week on hopes of an effective coronavirus vaccine.
Even though the oil contract was down about 34% since the start of the year, it was still up about 115% over the past seven months on hopes global economies and energy demand will return when governments lift coronavirus lockdowns.
U.S. crude production has recovered from the two-and-a-half-year lows touched in May mainly because shale producers have brought wells back online in response to rising prices.
However, production is expected to fall by 860,000 bbl/d this year to 11.39 MMbbl/d, and drop a further 290,000 bbl/d next year to 11.1 MMbbl/d, the U.S. Energy Information Administration (EIA) said Nov. 10.
The EIA expects production to decline in the second quarter of 2021 because new drilling activity will not generate enough production to offset declines from existing wells. Drilling activity will rise later in 2021, it forecast.
The combined oil and gas rig count rose two to 432 in the week to April 9, its highest since April 2020, Baker Hughes said in its weekly report.
U.S. oil rigs fell one to 309 this week, while gas rigs were unchanged at 92.
The combined oil and gas rig count, an early indicator of future output, rose five in the week to Aug. 27 to 508, its highest since April 2020, Baker Hughes Co. said in its weekly report.