Baker Hughes reports the North American rig count jumps by 94 to 741 from 647 in the previous week. The rig count is down 59 in the latest week from a year ago when it was at 800.

The U.S. rig count is down 2 from last week at 544 and down 40 rigs from 584 last year at this time. The Canadian count is up 96 from last week at 197 and compared to last year is down 19 from 216 a year ago. The Gulf of Mexico count is flat at 9 from a week ago and down 3 from 12 in the year-ago week.

For the U.S. count, rigs classified as drilling for oil are down 3 at 409, gas rigs are down 1 at 124 and miscellaneous rigs are up 2 at 11. For the Canadian count, oil rigs are up 79 at 128, gas rigs are up 17 at 69, and miscellaneous is flat at 0.

The Baker Hughes North American rig count tracks weekly changes in the number of active operating oil & gas rigs. Used for drilling wellbores for wells that may eventually produce oil or gas, active rigs are essential for the exploration and development of oil and gas fields. Rigs that are not active are not counted. Components in the data are the United States and Canada with a separate count for the Gulf of Mexico (which is a subset of the U.S. total). The count includes only rigs that are significant users of oilfield services and supplies.

Changes in rig counts point to changes in the supply of oil & gas. The higher the rig count, the greater the upward pressure is on oil & gas supply and in turn the greater the downward pressure is on oil & gas prices. The reverse applies when rig counts turn lower, as they did during the oil price collapse of 2014-15 when lower counts contributed to a subsequent decline in domestic oil inventories. Data on the Gulf of Mexico offer indications on production disruptions during the hurricane season (June 1st to November 30th).