U.S. energy firms this week cut the number of oil and natural gas rigs operating for a second week in a row for the first time since early October, energy services firm Baker Hughes said in its closely followed report on Nov. 22.

The oil and gas rig count, an early indicator of future output, fell by one to 583 in the week to Nov. 22, the lowest since early September. 

That puts the total rig count down 39, or 6% below this time last year.

Baker Hughes said oil rigs rose by one to 479 this week, while gas rigs fell by two to 99.

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 2% so far in 2024 after dropping by 11% in 2023, while U.S. gas futures were up about 42% so far in 2024 after plunging by 44% in 2023.

The 25 independent E&P companies tracked by U.S. financial services firm TD Cowen said that on average they planned to leave spending in 2024 roughly unchanged from 2023.

That compares with year-over-year spending increases of 27% in 2023, 40% in 2022 and 4% in 2021.

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