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Energy Rig Count in U.S. Advances for First Time in Nine Weeks

The gas and oil rig count in the U.S. gained for the first time in nine weeks, according to data from Baker Hughes Inc. (BHI)

Total energy rigs rose by four to 1,753, the first increase since Nov. 23. Oil rigs dropped by one to 1,315, data posted on the Baker Hughes website show. The gas count rose five to 434, the field-services company based in Houston said.

The total count has dropped from 2,008 a year ago as natural-gas exploration declines and technological advances in oil-drilling yield more output from wells, weakening producers’ appetite for new rigs. Crude production rose this month to the highest level since 1993, and stockpiles of the feedstock grew in June to the largest in 22 years.

U.S. rigs are expected to drop 5 percent this year, remaining “flat” during the first quarter, Peter Ragauss, Baker Hughes’ chief financial officer, said during a conference call with investors Jan. 23. The count fell sharply at end of last year “due to customers shutting down early before the holiday period.”

Crude for March delivery on the New York Mercantile Exchange slipped 3 cents to $95.92 a barrel at 12:20 p.m., down 3.5 percent from a year ago.

U.S. oil output slipped 0.7 percent to 6.99 million barrels a day in the seven days ended Jan. 18 after reaching the highest level since January 1993 a week earlier, according to data compiled by the Energy Information Administration, a division of the Energy Department. Stockpiles climbed 0.8 percent to 363.1 million barrels last week. They rose to a 22-year high of 387.3 million barrels in June.

Natural gas for February delivery declined 1.1 cents to $3.435 per million British thermal units on the Nymex at 12:17 p.m. today. Futures are up 26 percent from a year ago.

Gas stockpiles fell 172 billion cubic feet last week to 2.996 trillion, the EIA said yesterday.

To contact the reporters on this story: Lynn Doan in San Francisco at ldoan6@bloomberg.net; Richard Stubbe in Houston at rstubbe1@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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