U.S. energy firms this week added oil and natural gas rigs for the first time in eight weeks, energy services firm Baker Hughes said in its closely followed report on Jan. 31.

The oil and gas rig count, an early indicator of future output, rose by six to 582 in the week to Jan. 31. 

Despite this week's rig increase, Baker Hughes said the total count was still down 37 rigs, or 6% below this time last year.

Baker Hughes said oil rigs rose by seven to 479 this week, while gas rigs fell by one to 98. That weekly rise in oil rigs was the biggest increase since Feb. 2023.

For January, total oil and gas rigs fell by seven, the most in a month since June, with both oil and gas rigs down by four in January.

The oil and gas rig count declined by about 5% in 2024 and 20% in 2023 as lower U.S. oil and gas prices over the past couple of years prompted energy firms to focus more on paying down debt and boosting shareholder returns rather than raising output.

U.S. crude oil production fell by 122,000 bbl/d in November to 13.314 MMbbl/d, down from a monthly record high of 13.436 MMbbl/d in October, the U.S. Energy Information Administration said in its latest monthly report on Jan. 31.

Gross natural gas production in the U.S. Lower 48 states, meanwhile, rose by about 0.2% in November to 115.8 Bcf/d, according to the agency. That compared with a monthly record high of 117.8 Bcf/d in February 2024.

Meanwhile, U.S. oilfield services firms are facing weaker pricing and revenue this year as oil producers become increasingly efficient and keep a cap on spending, according to oilfield executives and analysts.

Baker Hughes, however, beat Wall Street estimates for fourth-quarter profit on Jan. 30, as robust demand for natural gas equipment and services helped offset weak sales of its drilling gear in North America.

Comments