Commodity prices have faltered, yet U.S. oil and natural gas producers continue to bolster drilling activity, adding eight more rigs over the course of the past week to bring Baker Hughes' (BHI) official tally to 941. 

In the 23rd consecutive week of U.S. rig additions, the oil rig count rose by 11 to 758, while the natural gas rig count fell by three to 183. Offshore rigs remained level at 22 and are up one year over year.

The U.S. rig count is up 520 rigs year over year when it stood at 421, with oil rigs up 428, gas rigs up 93 and miscellaneous rigs down one to zero.  

Notably, the current drilling rig recovery represents the fastest industry recovery in history, G. Allen Brooks, a managing director of energy-focused investment bank PPHB, wrote in a report issued earlier this week. 

But as Brooks pointed out, this recovery has not yet reached the levels of the recoveries of 1979 and 2009. And the current weakening of crude oil prices is likely to cut short the current recovery below levels reached in those earlier comebacks, he argued. 

Still, oil prices have now fallen 20% year to date, and the count of drilling rigs has increased by 283 in that period.

And what's perhaps worse for the oversupplied oil industry is that drilled but uncompleted wells, or DUCs, are now at 5,946, according to the U.S. Energy Information Administration, and they have been at record levels for the past two weeks, said Jeff Quigley, director of energy markets at consulting and analytics firm Stratas Advisors.

As Seaport Global Securities reported earlier this week, though, oil prices hovering around $40 per barrel for an extended period of time could force U.S. producers to pull back. If they don't, the firm suggested the industry could face another period of commodity prices in the $20-per-barrel range early next year.

West Texas Intermediate crude contracts for August delivery were up less than 1% to slightly more than $43 a barrel Friday around 1 p.m. ET

"The current hedging numbers and declining crude prices indicate the rig count is going to need to slow at some point," Quigley wrote in an email to TheStreet. "Something's gotta give."

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