U.S. energy firms this week cut the number of oil and natural gas rigs operating for the first time in four weeks, energy services firm Baker Hughes said in its closely followed report on Nov. 15.
The oil and gas rig count, an early indicator of future output, fell by one to 584 in the week to Nov. 15, the lowest since early September.
That puts the total rig count down 34, or 6% below this time last year.
Baker Hughes said oil rigs fell by one to 478 this week, their lowest since the week to July 19, while gas rigs also declined by one to 101.
The oil and gas rig count dropped about 20% in 2023 after rising by 33% in 2022 and 67% in 2021, due to a decline in oil and gas prices, higher labor and equipment costs from soaring inflation and as companies focused on paying down debt and boosting shareholder returns instead of raising output.
U.S. oil futures were down about 6% so far in 2024 after dropping by 11% in 2023, while U.S. gas futures were up 11% in 2024 after plunging by 44% in 2023.
U.S. crude output was on track to rise from a record 12.9 MMbbl/d in 2023 to 13.2 MMbbl/d in 2024 and 13.5 MMbbl/d in 2025, according to the latest U.S. Energy Information Administration (EIA) outlook this week.
The agency, however, slightly raised the 2024 oil production forecast while trimming the 2025 outlook from last month's report.
The EIA this week also cut its forecast for U.S. gas output to 103.4 Bcf/d in 2024, down from 103.5 Bcf/d expected last month.
Gas production will be down from a record high of 103.8 Bcf/d in 2023, the first decline since 2020, when the COVID-19 pandemic cut demand for the fuel.
Several gas producers reduced spending on drilling activities earlier in the year after monthly average spot prices at the U.S. Henry Hub benchmark in Louisiana plunged to a 32-yr low in March.