American oil companies are increasing the number of active drilling rigs

Relatively high oil prices are encouraging the US energy companies to drill more. Because of this, companies raised the number of operating rigs for two weeks in a row.

Energy company Baker Hughes Co. published a report showing that its number of rigs rose by 9 to 779 for the week. This is the highest number since March 2020.

The USA showed the highest number of oil rigs since March 2020. It rose by 9 to 622, while the number of gas rigs remained the same at 155.

Despite the increase in rigs over the past two years, the growth from the start of the pandemic in March 2020 was on average zero. Because of this, oil production levels are staying below the pre-pandemic record levels. This is explained by the fact that companies are focusing more on returning money to investors and paying off debts, rather than increasing production.

American financial company Cowen & Co. is monitoring independent exploration and production (E&P) companies. According to its statement, expenses of these companies are planned to increase by about 40% in 2022 in comparison to 2021 (last week's figure was 38%) after expenses increase by about 4% in 2021 in comparison to 2020.

However, according to some analysts, increased capital spending of energy companies is not a sign of production increases. In fact, spending is directed to more expensive pipelines and other equipment, as well as labor due to rapidly rising inflation and supply disruptions.