Dow Jones Newswires

HOUSTON (Dow Jones)--The number of rigs drilling for oil and natural gas climbed this week, marking the first increase in the U.S. rig count since April.

The number of oil and gas rigs climbed to 899, up 23 from the previous week, according to data from oil-field services company Baker Hughes Inc (BHI). The number of gas rigs was 692 - an increase of seven rigs from last week and the first increase in the count since February. The oil-rig count rose to 196, an increase of 13 rigs. The number of miscellaneous rigs increased by three to 11 rigs.

The number of gas rigs in use peaked at 1,606 in September. The rig count has been under pressure in recent months from lower natural gas prices. Analysts stopped short of saying that this week's increase signaled an uptick in U.S. drilling activity.

"One week is not indicative of a trend," said Cameron Horwitz, an analyst with SunTrust Robinson Humphrey in Houston, adding that he expected the natural gas rig count to decline next week as producers cut rigs to cope with lower prices.

However, the oil rig count could continue to climb, bolstered by the strength in the crude oil market, Horwitz said.

Natural gas prices have tumbled about 70% from summer highs amid robust production from U.S. onshore natural gas fields and weak demand. Large industrial consumers have curbed 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 reduce the flow of new gas supplies into the market.

Analysts anticipate that the sharp decline in natural gas drilling activity will eventually bring supply back in line with demand and help bolster gas prices.

Gas for July delivery on the New York Mercantile Exchange was recently down 2.9 cents, or 0.71%, at $4.064 a million British thermal units.

-By Jason Womack, Dow Jones Newswires; 713-547-9201; jason.womack@dowjones.com