July 7 (Reuters) – U.S. energy firms this week added oil and natural gas rigs for the first time in 10 weeks, due to the biggest weekly increase in gas rigs since October 2016, energy services firm Baker Hughes Co said in its closely followed report on Friday.
The oil and gas rig count, an early indicator of future output, rose six to 680 in the week to July 7. Despite this week’s rig increase, Baker Hughes said the total count was still down 72 rigs, or 10%, below this time last year.
U.S. oil rigs fell five to 540 this week, their lowest since April 2022, while gas rigs rose 11 to 135 their highest since early June.
In the Permian in West Texas and eastern New Mexico, the nation’s biggest shale oil basin, drillers added seven gas rigs, bringing the gas total up to a near 10-year high of 12, and cut six oil rigs, bringing the oil total down to a 15-month low of 330, according to Baker Hughes.
The seven Permian gas rigs added were the most in a week since January 2013.
Data provider Enverus, which publishes its own rig count data, said drillers cut four rigs in the week to July 5, reducing the overall count to 732. That put the total count down about 10 rigs in the last month and down 13% year-over-year.
U.S. oil futures were down about 9% so far this year after gaining about 7% in 2022. U.S. gas futures, meanwhile, have plunged about 43% so far this year after rising about 20% last year.
The weekly gas rig count hike was unusual as the massive drop in gas prices has already caused some companies to reduce production by cutting rigs – especially in the Haynesville shale in Arkansas, Louisiana and Texas.
Despite some plans to lower rig counts, the independent exploration and production companies tracked by U.S. financial services firm TD Cowen were on track to boost spending by about 19% in 2023 versus 2022 after increasing spending about 40% in 2022 and 4% in 2021.
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