US energy companies increase the number of rigs as oil prices rise

US energy companies increase the number of rigs as oil prices rise
US energy companies increase the number of rigs as oil prices rise

American energy companies supplied the number of operating oil and gas rigs for the sixth week in a row, with oil prices rising to the highest level since 2014, according to the website of the Russian Sputnik agency.

The Minister of Awqaf receives his Sudanese counterpart and the Supreme Council for Islamic Affairs in South Sudan

The number of oil and gas rigs, an early indicator of future production, rose 10 to 543 in the week to October 15, the highest level since April 2020, according to energy services company Baker Hughes in its closely watched report.

This brings the total rig count to 261 rigs, or 93%, during this time last year.

US oil rigs rose from 12 to 445 this week, the highest level since April 2020, while gas rigs fell one to 98, the lowest level since last August.

US crude futures rose to their highest levels since 2014 this week, and are currently trading at about $82 a barrel on Friday, amid expectations of a supply deficit over the next few months, as the rocketing rise in gas and coal prices fueled the shift to oil products.

With oil prices up about 69% so far this year, some energy companies have said they plan to increase spending in 2021 after cutting drilling and completion expenses in 2019 and 2020.

However, this increase in spending remains small as most companies continue to focus on boosting cash flow, reducing debt and increasing shareholder returns rather than adding production.

With oil prices continuing to rise, producers are expected to slowly abandon their previous policies of stringent capital discipline in the wake of COVID, and to increase drilling activity tepidly, analysts at gas markets advisory Gelber & Co. said in a report.

But it will take some time for increases in rigs to translate into an increase in oil production.

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