Rigs targeting oil and natural gas in the U.S. rose by 23 this week to 1,777, according to Baker Hughes Inc. The gain was the largest in nine months.
Oil rigs increased 15 to 1,408, data posted on the company’s website show. The gas count advanced by eight to 365, the Houston-based field services company said. Miscellaneous rigs were unchanged at four.
“Most of the growth was in oil rigs, which is exactly what you would expect,” Jim Williams, president of London, Arkansas-based WTRG Economics, said by phone. “We’re starting to see a little bit of growth in gas that may be due to the higher prices we started seeing a couple months ago.”
Energy producers including BP Plc, ConocoPhillips and Continental Resources Inc. are using more efficient drilling techniques in U.S. shale-oil plays to extract the most oil in 25 years.
U.S. oil output rose to 8.16 million in the week ended Jan. 10, the most since 1988, according to the U.S. Energy Information Administration. Crude stockpiles declined 7.66 million to 350.2 million.
West Texas Intermediate crude for February delivery rose 41 cents, or 0.4 percent, to settle at $94.37 a barrel on the New York Mercantile Exchange, down 1.2 percent in the past year.
U.S. gas stockpiles dropped 287 billion cubic feet last week to 2.53 trillion, the EIA said. Natural gas for February delivery fell 5.6 cents, or 1.3 percent, to settle at $4.319 per million British thermal units on the Nymex, up 24 percent from a year ago.
The increase was led by the Permian Basin in West Texas and southeast New Mexico, which the largest onshore oil field in the U.S. The area gained seven rigs to 478. The Permian rig count is up by 26 from this time last year.
The Denver-Julesburg and Niobrara basins, which are in Colorado and Wyoming and portions of Nebraska and Kansas, added four rigs from the previous week to 55. The rig count is up by 57 percent from this time last year.
“That’s going to be increasingly important, and I think it’s an area for us to watch closely over the next few months,” Williams said. “It’s probably the fastest-growing play, and I think it’s going to continue to be so. Historically the Niobrara was a gas play, but it’s increasingly becoming liquid -- oil and wetter gas plays.”
Horizontal rigs made up 66.01 percent of the total count, down from last week’s record high of 66.02 percent.