New drilling permits issued across the United States climbed by almost 4,000 in March, the largest increase in 18 months, Evercore ISI said Tuesday.
The number of newly issued U.S. drilling permits has increased steadily since OPEC struck its deal to curb oil production in November. As oil prices rose and drillers locked-in higher prices for future oil production, permitting activity accelerated in February and March, getting closer to levels that were typical before the two-year oil downturn, according to the investment bank, which compiles state permitting data for a monthly report.
It’s another sign of a surge in U.S. drilling that, along with rising output in other countries, could counteract much of OPEC’s effort to cut oil production. It also implies Houston’s oil field service companies and drilling contractors will have more work in coming months and will likely increase hiring in the oil patches in Texas and elsewhere.
Last month, U.S. drilling permits came in nearly a quarter higher than they did in February, and it was more than twice the number that came in March 2016. Permits surged in Texas, California, Wyoming, Colorado, Oklahoma, New Mexico and North Dakota.
In the Gulf of Mexico, deep-water drilling permits rose from two to five in March, and overall, offshore permits increased to 17, up from eight the month before, according to Evercore ISI.