(Reuters) - U.S. energy companies added oil rigs for a fifth straight week, extending a nine-month recovery as drillers take advantage of crude prices that have held mostly over $50 a barrel since OPEC agreed to cut supplies in late November.
Drillers added six oil rigs in the week to Feb. 17, bringing the total count up to 597, the most rigs since October 2015, energy services firm Baker Hughes Inc said on Friday.
During the same week a year ago, there were 413 active oil rigs.
Since crude prices first topped $50 a barrel in May after recovering from 13-year lows last February, drillers have added a total of 281 oil rigs in 34 of the past 38 weeks, the biggest recovery in rigs since a global oil glut crushed the market over two years starting in mid 2014.
Baker Hughes oil rig count plunged from a record 1,609 in October 2014 to a six-year low of 316 in May as U.S. crude collapsed from over $107 a barrel in June 2014 to near $26 in February 2016.
U.S. crude futures traded around $53 a barrel on Friday, putting the contract on track to fall for the first week in five, as record high U.S. crude stocks and rising production undermine efforts by the Organization of the Petroleum Exporting Countries (OPEC) and other producers to drain a global oil glut.
U.S. shale oil production for March is expected to rise by nearly 79,000 barrels per day - the most in five months - to 4.87 million bpd, its highest rate since May last year, government data showed on Monday.
Analysts said they expect U.S. energy firms to boost spending on drilling and pump more oil and natural gas from shale fields in coming years now that energy prices are projected to keep climbing.
Futures for the balance of 2017 were trading around $54 a barrel, while calendar 2018 was fetching less than $54.50.
BofA Merrill said this week U.S. shale oil production could grow by 3.5 million bpd to 2022, delivering more than 80 percent of incremental non-OPEC barrels.
Shale producers, however, are facing their first production cost hike in five years as industry activity picks up and energy service providers hike fees to take a bigger share of the profits generated by higher oil prices. The break-even production costs will rise an average of $1.60 to $36.50 per barrel this year, according to data from Rystad Energy, which surveys producers.
Analysts at U.S. financial services firm Cowen & Co said in a note this week that its capital expenditure tracking showed 37 exploration and production (E&P) companies planned to increase spending by an average of 45 percent in 2017 over 2016.
That spending increase in 2017 followed an estimated 48 percent decline in 2016 and a 34 percent decline in 2015, Cowen said according to the 64 E&P companies it tracks.
Reporting by Scott DiSavino; Editing by Marguerita Choy
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