U.S. oil and gas producers added one drilling rig last week, according to Baker Hughes (BHGE) , bringing the Houston oilfield services provider's total count to 944.
Baker Hughes data showed the oil rig count decreased by three week over week to 756, while the natural gas rig count grew by four to 187.
Meanwhile, the U.S. offshore rig count is flat week over week and down two year over year.
Baker Hughes rig count is now up 436 rigs since this time in 2016, with oil rigs up 342, natural gas rigs up 95 and miscellaneous rigs down one.
The increased rig activity comes as crack spreads -- the difference between the price of crude oil and the refined petroleum products derived from crude -- have surged in recent weeks with refining capacity in the Gulf Coast region hampered by Hurricane Harvey.
About 21% of U.S. refining capacity is located in the gulf, and while Moody's Analytics analysts suspect roughly 45% of the region's affected refining capacity is now back online, the firm also anticipates that energy prices will be higher in the months to come due to the minimal drop in the demand for petroleum products and the temporary shutdown of many offshore and shale oil and gas rigs.
"We believe that the demand for rigs will be strong, as higher energy prices will make it economical to resume drilling and production at many sites," Moody's analysts David Munves and Xian Li wrote in a Thursday, Sept. 7, report.
The U.S. Energy Information Administration reported Wednesday that oil and gas production in the so-called Lower 48 United States was down 800,000 barrels per day last week, while crude exports were down 750,000 barrels per day to almost zero.
Domestic crude inventories grew by 4.3 million barrels during the week ended Sept. 1, while gasoline inventories were reduced by 3.2 million barrels, according to the EIA.
Refinery inputs experienced a 3.3 million barrel-per-day decrease during the week as refiners operated at 79.9% of their operable capacity nationwide.
But offsetting the lower refinery utilization was a massive 2.5 million barrel per day reduction in petroleum product exports, according to analysts at energy-focused research firm and investment bank Tudor, Pickering, Holt & Co., who said investors should "expect more volatility in the next few weeks."
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