US oil rig count spikes by 21

csc oil rig

(Reuters)

The US oil rig count jumped this week by 21 to 498, the biggest increase since July 2015 according to driller Baker Hughes.

Six gas rigs were added, taking their total to 125. With miscellaneous rigs unchanged at one, the combined tally increased by 27 to 624 rigs.

US oilfield services companies have seen stronger demand from producers amid stabilizing oil prices.

Oil rallied further after the Organization of Petroleum Exporting Countries (OPEC) agreed on November 30 to lower its output by about 1.2 million barrels per day from early next year.

If US shale-oil production continues to ramp up, it could hamper OPEC's efforts to reduce the worldwide glut of oil. Meanwhile, there are doubts about whether OPEC members will stick to their agreement. A Reuters survey found that the cartel drilled a record amount of oil in November.

OPEC and non-OPEC members will meet again this weekend.

12 9 16 oil rigs chart

(Andy Kiersz/Business Insider)

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