Since the beginning of the year, the Baker Hughes U.S. rig count had fallen from 578 on January 8 to low of 404 in late May. Since then, U.S. producers have added 36 rigs as of last Friday, bringing the total number of rigs now working to 440.

Rising prices beginning around June 1 are the principal reason for the increase, with Permian Basin producers accounting for 21 new rigs since the end of May. The Williston Basin (Bakken) accounted for six new rigs, and no other oil and gas basin accounted for more than two.

Shale oil analysts at Rystad Energy conclude that the increased drilling activity and lower inventory of drilled, uncompleted wells mean that shale production will “bottom out” during the summer and add barrels through the end of this year. Rystad notes that U.S. oil production from horizontal wells during 2016 has been “resilient,” experiencing a decline of just 100,000 barrels a day from January to May.

The researchers further expect drilling activity to be focused in the four core U.S. basins: the Permian, Eagle Ford, Williston and Niobrara. Some 70% of shale drilling in the country will be done in these four basins if crude prices remain around $50 a barrel. If the price should rise beyond $50 as expected sometime next year, drilling activity could ramp up again in other non-core plays.

The currency markets may be driving lower commodities prices Monday, as the euro and the Japanese yen both weaken. West Texas Intermediate (WTI) crude for August delivery traded down about 0.3% late Monday morning at $45.28. That’s a discount of about $1.30 a barrel to Brent and about $0.65 a barrel to WTI for September delivery.

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