Quantum Commodity Intelligence -North American drilling activity registered a sharp increase during the first week of December after three consecutive falls, according to the latest report from oilfield services firm Baker Hughes.
The overall count was up seven rigs at 589 in the week ending 6 December, leaving the total 37 lower on the year and down from 622 at the start of 2024.
However, the data collection period was extended due to the previous shortened week, which coincided with the Thanksgiving holiday.
Rigs drilling for oil increased by five units to 482 but still 21 fewer than at the same stage last year, while rigs drilling for gas edged up by two to stand at 102 and down 17 year-on-year.
Texas, the largest-producing state accounted for most of the gains, increasing five to stand at 286 but still 22 lower on the year.
The Permian Basin, spanning West Texas and New Mexico, was up just one rig at 304 and 11 lower on the year, with the Texas gains largely coming from smaller production sites.
Last week oil and gas giant Chevron said it will slash investment in the Permian Basin to between $4.5 billion and $5 billion in 2025, reducing capital expenditure by up to 10%.
Chevron still plans a further output lift from the Permian next year, although growth will significantly slow as it nears the 1-million bpd target for 2025.
Crude prices ended the week lower as demand concerns and a supply surplus continued to weigh on global benchmarks, despite OPEC+ delaying planned production increases for another three months.
NYMEX WTI trading on the Chicago Mercantile Exchange closed Friday at $67.20/b for the Jan25 contract, a drop of 1.2% on the week.
Feb25 ICE Brent futures closed at $71.12/b, down 1% over the same timeframe.
US natural gas prices surrendered some of the solid November gains as milder temperatures reduced domestic demand, while supplies remain elevated.
The Jan25 NYMEX Henry Hub contract closed at $3.076/ mmBtu on 6 December, down 8.5% on the week, having gained around 15% in November.
The forward curve was in backwardation for the Q1 period, with Feb25 closing at $2.931/ mmBtu and Mar25 at $2.686/ mmBtu.