U.S. energy companies have recorded an increase in the number of oil and natural gas rigs for the second consecutive week, a development highlighted by energy services firm Baker Hughes in its latest report. As of April 25, the oil and gas rig count rose by two to reach a total of 587. This is the first back-to-back increase since February, although the total remains 26 rigs, or 4%, lower than the same time last year.
In this recent surge, Baker Hughes reported that oil rigs increased by two, bringing the total to 483, while gas rigs saw a rise of one, now totaling 99. Oklahoma, which ranks third in rig counts behind Texas and New Mexico, added two rigs this week for a total of 55, the highest it has been since April 2023. Despite this week’s gains, the month of April witnessed a reduction in rig numbers, with a net decrease of five rigs.
This decline was characterized by one less oil rig and four fewer gas rigs, marking the second consecutive month of falling counts. Over the past two years, the oil and gas rig count declined by approximately 5% in 2024 and 20% in 2023. Lower oil and gas prices have shifted energy firms’ priorities towards enhancing shareholder returns and reducing debt instead of ramping up production.
The landscape remains challenging, particularly for smaller U.S. shale producers, as decreasing crude prices and rising construction costs due to tariffs are leading many to curtail drilling activities. Both Baker Hughes and Halliburton have warned of revenue impacts associated with the slowdown in drilling activity. Consequently, Baker Hughes has adjusted its forecast, projecting a low double-digit decline in oil and gas producer spending in the U.S. and Canada, compared to an earlier estimate of a mid-single-digit drop.