US Drillers Add Oil and Gas Rigs for Fifth Week in a Row, Baker Hughes Reports

U.S. energy firms have added oil and natural gas rigs for a fifth consecutive week, marking the first time this has occurred since May 2022, according to a report by energy services firm Baker Hughes. The oil and gas rig count, which serves as an early indicator of future output, increased by one to reach 593 in the week ending February 28, the highest level since June.

Despite this week’s increase, the total rig count remains 36 rigs, or 6%, below the same period last year. Baker Hughes noted that oil rigs decreased by two to 486, while gas rigs increased by three to 102. In February, the total number of oil and gas rigs rose by 11, the largest monthly increase since November 2022. Oil rigs saw a seven-rig increase, also the biggest monthly gain since November 2022, and gas rigs increased by four.

The rig count has declined by about 5% in 2024 and 20% in 2023 due to lower U.S. oil and gas prices over the past couple of years. These price reductions have prompted energy firms to prioritize boosting shareholder returns and paying down debt rather than increasing output.

The 22 independent exploration and production (E&P) companies tracked by U.S. financial services firm TD Cowen plan to cut spending in 2025 by around 1% compared to 2024 levels. This follows roughly flat year-over-year spending in 2024 and increases of 27% in 2023, 40% in 2022, and 4% in 2021.