HOUSTON (Dow Jones)--The number of rigs drilling for oil and natural gas in the U.S. fell this week as producers continued to scale back drilling activity amid slumping energy prices.
The number of oil and gas rigs fell to 928, down 17 from the previous week, according to rig data from oil-field services company Baker Hughes Inc. (BHI). The number of gas rigs was 730, a drop of 11 rigs from last week, while the oil rig count dropped to 190, a decrease of six rigs. The number of miscellaneous rigs was flat at eight rigs.
The number of gas rigs in use peaked at 1,606 in September.
Natural gas prices have plummeted about 69% from summer highs amid robust production from U.S. onshore natural gas fields and shrinking demand. Large industrial consumers have scaled back gas use to cut costs during the recession. In response to falling gas prices, producers such as Chesapeake Energy Corp. (CHK) and Devon Energy Corp. (DVN) have slashed their spending plans and rig counts to curb the flow of new gas supplies into the market.
Analysts anticipate that the brisk pullback in natural gas drilling activity will eventually bring supply back in line with demand and help bolster gas prices.
Gas for June delivery on the New York Mercantile Exchange was recently up 15.8 cents, or 3.87%, at $4.239 a million British thermal units.