U.S. energy companies added oil rigs for a 14th week in the last 15, extending a nine-month recovery as drillers take advantage of crude prices that have held mostly over $50 a barrel since OPEC agreed to cut supplies in late November.
Drillers added eight oil rigs in the week to Feb. 10, bringing the total count up to 591, the most since October 2015, energy services firm Baker Hughes Inc s
aid on Friday.
Since crude prices first topped $50 a barrel in May after recovering from 13-year lows last February, drillers have added a total of 275 oil rigs in 33 of the past 37 weeks, the biggest recovery in rigs since a global oil glut crushed the market over two years starting in mid 2014.
Baker Hughes oil rig count plunged from a record 1,609 in October 2014 to a six-year low of 316 in May as U.S. crude collapsed from over $107 a barrel in June 2014 to near $26 in February 2016.
U.S. crude futures traded around $54 a barrel on Friday, putting the contract on track for an eight week of gains in the last nine, as the Organization of the Petroleum Exporting Countries (OPEC) and other producers cut production in an effort to end a global oil glut and raise prices.
Analysts said they expect U.S. energy firms to boost spending on drilling and pump more oil and natural gas from shale fields in coming years now that energy prices are projected to keep climbing.
Futures for the balance of 2017 were trading around $55 a barrel, while calendar 2018 was fetching near $56.
"Given the robust U.S. rig count growth over the past month, we are slightly raising our U.S. rig count from 800 to 850 rigs in 2017," analysts at U.S. financial services company Raymond James said in a note this week, referring to the combined oil and natural gas rig count.
For 2018, Raymond James said it was maintaining its 1,100 rig estimate. Most rigs produce both oil and gas.
That compares with an average of 700 so far in 2017, 509 in 2016 and 978 in 2015, according to Baker Hughes data.
Analysts at U.S. financial services firm Cowen & Co said in a note this week that its capital expenditure tracking showed 33 exploration and production (E&P) companies planned to increase spending by an average of 36 percent in 2017 over 2016.
That spending increase in 2017 followed an estimated 45 percent decline in 2016 and a 37 percent decline in 2015, Cowen said according to the 65 E&P companies it tracks.
(Reporting by Scott DiSavino; Editing by Marguerita Choy)