((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto)) by Scott DiSavino
U.S. energy companies added oil and natural gas drilling rigs this week for the first time in four weeks, energy services company Baker Hughes BKR.O said in its closely watched report on Friday.
The number of oil and gas drilling rigs, an early indicator of future production, increased by one to 586 in the week ended October 11.
Baker Hughes said the total rig count was still down 36, or 6 percent, compared to the same period last year.
Baker Hughes said the number of oil drilling rigs increased by two to 481 this week. The number of gas drilling rigs decreased by one to 101.
The number of oil and gas drilling rigs fell by about 20% in 2023, due to falling oil and gas prices, rising labor costs and equipment due to soaring inflation and the fact that companies focused on paying down debt and increasing shareholder returns rather than increasing production. The number of drilling rigs increased by 33% in 2022 and 67% in 2021.
U.S. oil CLc1 futures are up about 5% so far in 2024 after falling 11% in 2023, while U.S. gas NGc1 futures are up about 5% so far in 2024. ‘now in 2024 after falling 44% in 2023.
Rising oil prices are expected to prompt drillers to increase U.S. crude production from a record 12.9 million barrels per day (bpd) in 2023 to 13.2 million bpd in 2024 and 13.5 million barrels per day (bpd). bpd in 2025, according to the latest outlook from the U.S. Energy Information Administration (EIA).
On the gas side, several producers cut drilling spending earlier this year after the monthly average spot price at the Henry Hub NG-W-HH-SNL benchmark in Louisiana fell to its previous level. the lowest in 32 years in March.
This decline in drilling is expected to cause U.S. gas production to decline to 103.5 billion cubic feet per day (bcfd) in 2024, compared to a record 103.8 bcfd in 2023, according to the EIA.
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