US adds oil, gas rigs for ninth week

US energy drillers this week added oil and natural gas rigs for a ninth consecutive week according to data released on Friday, as mostly small producers respond to high prices and prodding by the government to ramp up output.

Since Moscow invaded Ukraine on Feb. 24, the US government has urged drillers to produce more oil and gas to reduce domestic prices and help allies break their dependence on Russia energy. Benchmark US. crude prices are up about 49% so far this year.

The oil and gas rig count, an early indicator of future output, rose 14 to 728 in the week to May 20, its highest since March 2020, energy services firm Baker Hughes Co said in its closely followed report.

Baker Hughes said that puts the total rig count up 273, or 60%, over this time last year. US oil rigs rose 13 to 576 this week, their highest since March 2020, while gas rigs gained one to 150, their highest since September 2019.

More than half of US oil rigs are in the Permian shale in West Texas and eastern New Mexico where total units this week jumped by eight to 343, the most since April 2020. The rig count has grown for a record 21 months but incrementally, as publicly-traded producers stick to their capital discipline that has kept overall production about a million barrels per day (bpd) below the nation’s 2019 record.

Several of the producers that have started drilling in recent months were small, private companies that usually react quickly to changes in crude prices. Many of the publicly-traded firms, meanwhile, have only slowly raised their spending on new drilling as they continue to return cash to shareholders and pay down debt. Oil output in the Permian is due to rise 88,000 bpd to a record 5.219 million bpd in June, government data showed.