April 19 (Reuters) - U.S. energy firms this week added

oil and natural gas rigs for the first time in five weeks,

energy services firm Baker Hughes ( BKR ) said in its closely

followed report on Friday.

The oil and gas rig count, an early indicator of future

output, rose by 2 to 619 in the week to April 19.

Despite this week's rig increase, Baker Hughes ( BKR ) said the

total count was still down 134, or 18%, from this time last

year.

Baker Hughes ( BKR ) said oil rigs rose 5 to 511 this week, their

highest since September, while gas rigs fell 3 to 106, their

lowest since December 2021.

The oil and gas rig count dropped about 20% in 2023

after rising by 33% in 2022 and 67% in 2021, due to a decline in

oil and gas prices, higher labor and equipment costs from

soaring inflation and as companies focused on paying down debt

and boosting shareholder returns instead of raising output.

U.S. oil futures were up about 17% so far in 2024

after dropping by 11% in 2023. U.S. gas futures,

meanwhile, were down about 30% so far in 2024 after plunging by

44% in 2023.

That increase in oil prices should encourage drillers to

boost U.S. crude output from a record 12.9 million barrels per

day (bpd) in 2023 to 13.2 million bpd in 2024 and 13.7 million

bpd in 2025, according to the latest U.S. Energy Information

Administration (EIA) outlook.

But the drop in gas prices to 3-1/2-year lows in

February and March has caused several producers to slash

spending and reduce drilling activities, which should cut U.S.

gas output to 103.6 billion cubic feet per day (bcfd) in 2024

from a record 103.8 bcfd in 2023, according to the EIA.