The US oil-rig count rose by two to 722 last week, according to oilfields-services company Baker Hughes.
This week marks the one-year anniversary of when the tally bottomed after the price downturn. The stunning drop in the number of rigs was a proxy for how hard lower prices were hurting exploration companies.
With 19 straight weeks of rig additions and oil near $50 a barrel, producers are clearly more confident in market conditions than they were a year ago.
The gas-rig count increased by five to 185. With one miscellaneous rig remaining in use, the total rig count rose by seven to 908.
The front-month contract for West Texas Intermediate crude oil, the US benchmark, was on pace for a 1.6% weekly decline after the rig-count data release. Oil fell on Thursday even after OPEC and its allies extended their agreement to lower production by nine months. The Organization of Petroleum Exporting Countries – a cartel of major oil producers – extended the deal that started in January to address the global supply glut that has subdued prices.
But the extension had been widely expected, and traders realized that the robustness of US shale-oil production could undermine OPEC’s cuts.
- Andy Kiersz/Business Insider