Aug 2 (Reuters) - U.S. energy firms this week cut the

number of oil and natural gas rigs operating for the first time

in three 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, fell by three to 586 in the week to Aug. 2.

Baker Hughes ( BKR ) said that puts the total rig count down 73, or

11%, below this time last year.

Baker Hughes ( BKR ) said oil rigs were steady at 482 this week,

while gas rigs fell by three to 98.

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 2% so far in 2024

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

were down about 24% so far in 2024 after plunging by 44% in

2023.

Latest

government data

showed U.S. crude oil production fell in May in its first

monthly decline since January, while natural gas output

decreased in the month to its lowest since February 2023.

Meanwhile,

Exxon Mobil ( XOM )

boosted its profit in the second quarter partly due

to volume gains from its purchase this year of shale oil firm

Pioneer Natural Resources.

The top U.S. oil producer increased its annual capital

expenditure guidance to $28 billion from the previously

estimated $23-$25 billion.

The results also showed higher cash flow from operations

which will help fund higher share buybacks and dividends. It

also plans to buy back $19 billion in shares this year, the

largest share repurchase program among its top Western rivals,

up from $17.4 billion last year.