Last week marked the third consecutive week of increased online rig count.

In this segment of the Industry Focus: Energy podcast, Sean O'Reilly and Taylor Muckerman go over the numbers, what this means for the oil sector at large, and how many rigs might be online by early 2018.

A full transcript follows the video.

This podcast was recorded on June 23, 2016.

Sean O'Reilly: Taylor, we're diving back in, here, with the latest news in energy.

Taylor Muckerman: A little bit more boring than asteroid mining and driverless cars.

O'Reilly: She asked that question. I had the picture of the guy in Doctor Strangelove, riding the bomb down on the ground, waving his cowboy hat and stuff, yee-haw.

Muckerman: I can see that.

O'Reilly: I guess, Taylor, this section is they're back with land rigs.

Muckerman: It kind of reminded me of Independence Day, where he's like "I'm back!" He's looking up into the alien spacecraft. But, yeah, rigs, they're coming back online.

O'Reilly: Third consecutive week of increases. The Eagle Ford Geological Region down in Texas added four rigs. Permian in West Texas added four. National rig count stands for the United States at 424. Increase sounds bad, because this is going to cause another glut, but this is way below where we were.

Muckerman: Yeah, you are looking at basically 80%. October 2014, curiously the month just before OPEC decided to...

O'Reilly: Go figure.

Muckerman: You saw just over 1,600 rigs. I think they said 1,609 was the all-time peak. In May of this year, we bottomed at the lowest number that Baker Hughes (NYSE:BHI) has seen since they were tracking this since 1944, over 70 years now, and that was the lowest we've ever seen the rig count.

O'Reilly: The previous episode, I think we mentioned it was 1952 was the last time that it got this low. What do you think? I saw this quote by this energy executive and he was like, "Yeah, this is the beginning of the comeback," and all this stuff. "You're in the bottom of the Grand Canyon right now, man!"

Muckerman: Basically, when you talk about net nine rigs came online in a week, there's a lot of ground to make up, but there [are] clearly too many rigs to begin with when you had over 1,600. Where is that middle ground? I'm not sure.

O'Reilly: 900.

Muckerman: Okay. You want to take bets? We can take some bets here at the next high water mark.

O'Reilly: What's the over/under on January 2018?

Muckerman: 900?

O'Reilly: Yeah.

Muckerman: I'll take the under.

O'Reilly: You would?

Muckerman: In, what is it, in a year and a half?

O'Reilly: Yeah. You'll take the under?! Okay.

Muckerman: Only because rigs are becoming more efficient.

O'Reilly: That's a good point!

Muckerman: They scrapped a lot of rigs in this downturn, there's less rigs to even bring back.

O'Reilly: ...Everybody keeps talking about scrapping. Is it literally melting the metal down and using it for cars or something? I mean, is it gone, gone?

Muckerman: They could be doing something like that. For the most part, though, they're just parting them out because there are a lot of replacement on these rigs in terms of parts, and so you're seeing a lot of these rigs just totally broken down---

O'Reilly: Dismantled and sending widgets to other rigs.

Muckerman: ...Yeah. X rig needs this. This rig's been sitting here, let's just disassemble it and distribute the parts. Basically, this rigs are just disappearing into thin air and being parted out.