(Reuters) – U.S. energy firms this week cut the number of oil and natural gas rigs operating for the first time in six weeks, energy services firm Baker Hughes said in its closely followed report on Friday.
The oil and gas rig count, an early indicator of future output, fell by one to 592 in the week to March 7.
Baker Hughes said this week’s decline puts the total rig count down 30, or 5% below this time last year.
Baker Hughes said oil rigs were unchanged at 486 this week, while gas rigs fell by one to 101.
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 boosting shareholder returns and paying down debt rather than raising output.
Even though analysts forecast U.S. spot crude prices would remain unchanged in 2025, the U.S. Energy Information Administration (EIA) projected crude output would rise from a record 13.2 million barrels per day (bpd) in 2024 to around 13.6 million bpd in 2025.
On the gas side, the EIA projected a 73% increase in spot gas prices in 2025 would prompt producers to boost drilling activity this year after a 14% price drop in 2024 caused several energy firms to cut output for the first time since the COVID-19 pandemic reduced demand for the fuel in 2020.
The EIA forecast gas output would rise to 104.6 billion cubic feet per day (bcfd) in 2025, up from 103.1 bcfd in 2024 and a record 103.6 bcfd in 2023.
Reporting by Scott DiSavino and Brijesh Patel Editing by Marguerita Choy
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