Energy services firm Baker Hughes (BKR, Financial) reported an increase in U.S. oil and gas drilling activity for the first time in four weeks. The number of active drilling rigs, a leading indicator of future production, rose by one to a total of 586 during the past week.
Despite this increase, the current number of rigs remains 6% lower than the same period last year, with a decrease of 36 rigs overall. Specifically, oil rigs increased by two, reaching a count of 481, while gas rigs decreased by one, totaling 101.
In Pennsylvania, the number of drilling rigs fell by two, reducing the state's total to 13, the lowest since July 2016. This decline in drilling numbers is attributed to dropping oil and gas prices, rising labor and equipment costs due to inflation, and companies focusing on debt repayment and shareholder returns rather than boosting output.
Overall, the number of oil and gas rigs has decreased by approximately 20% in 2023, a stark contrast to the 33% growth observed in 2022 and 67% growth in 2021.
