Baker Hughes reports that US drillers have cut back on oil and gas drilling for the first time in 3 weeks.

Baker Hughes, a closely watched energy services firm, said that U.S. firms have cut back on the number of oil rigs and natural gas rigs operating for the first time since three weeks.

The number of oil and gas drilling rigs, a leading indicator of future production, dropped by two in the week ending January 9 to 544, the lowest level since mid-December.

Baker Hughes reported that the total number of rigs is down by?40, or 7%, from this time last week.

Baker Hughes reported that oil rigs dropped by three this week to 409, and gas rigs by one, the lowest level since October.

Oil and gas rig counts declined by around 7% in '2025, 5% a year later in 2024 and 20% a year later in 2023, as lower U.S. oil prices prompted energy companies to concentrate more on increasing shareholder returns and paying off debt than increasing production.

The independent exploration companies monitored by financial services company TD Cowen have said that they plan to maintain capital expenditures at the same level in 2026, after cutting their spending by?4% around 2025.

This compares to a roughly flat level of spending from year to year in 2024. In 2023 and 2022, the figures increased by 27%, 40%, and 4% respectively.

The U.S. Energy Information Administration predicted that crude production would decline from a record of 13.6 million barrels a day in 2025 to 13.5 million bpd by 2026.

The EIA predicted that a?13% rise in spot gas prices in 2026 would prompt producers to increase gas production to around 109.1 bcfd this year. This is up from the record 107.7bcfd of 2025. (Reporting and editing by Chris Reese, Nia Williams, and Scott DiSavino)

(source: Reuters)