U.S. oil and natural gas producers added eight drilling rigs this week, bringing the total number of active rigs in the country to 958, according to data released this afternoon by Baker Hughes. The increase defied expectations of a falloff in domestic rig growth, causing a slight decline in crude futures compared to a rise earlier in the day.
September crude futures hit a high of $49.81 ahead of the data release before falling to $49.65, still 0.63% above the open price. September natural gas futures are down 0.71% to $2.946 from an open of $2.958, though the bulk of the natural gas decline came before the data was publicized.
The eight drilling rigs include two oil rigs and six natural gas rigs. Seven horizontal drilling rigs were added as well as two directional rigs. One fewer vertical rig was reported, compared to last week.
New Mexico and Oklahoma added the most rigs this week, with New Mexico adding four and Oklahoma adding three. Texas, which contains the oil-rich Permian basin, reported one fewer rig this week, despite the Permian adding five.
Analysts have said sustained low oil prices are unlikely to increase unless U.S. production dramatically changes. The first sign of a decrease in production could be a decline in the pace of rig count growth. U.S. oil and natural gas producers have added 463 drilling rigs over the last twelve months.