Sept 27 (Reuters) - U.S. energy firms reduced the number of oil rigs this week and for a record 10th month in a row as producers follow through on plans to cut spending on new drilling this year.

Drillers cut six oil rigs in the week to Sept. 27, bringing the total count down to 713, the lowest since May 2017, General Electric Co's Baker Hughes energy services firm said in its closely followed report on Friday. RIG-OL-USA-BHI

In the same week a year ago, there were 863 active rigs.

The rig count fell 29 in September, and 80 during the third quarter, the biggest quarterly decline since the first quarter of 2016.

The oil rig count, an early indicator of future output, has declined over a record 10 months as independent exploration and production companies cut spending on new drilling as they focus more on earnings growth instead of increased output.

That reduction in activity showed up in an energy survey released on Wednesday by the Federal Reserve Bank of Dallas.

Although oil production rose, service firms reported declines in activity, a sign that operators have figured out how to pull more oil from the ground with fewer rigs. Overall, the outlook from 55 oilfield services executives surveyed was negative.

U.S. oil output from seven major shale formations is expected to rise by 74,000 barrels per day (bpd) in October to a record high 8.843 million bpd, the U.S. Energy Information Administration said in its monthly drilling productivity report on Monday.

U.S. crude futures traded below $56 per barrel on Friday, putting the contract on track for its biggest weekly loss since mid July on a faster-than-expected recovery in Saudi output and concerns about global demand amid slowing Chinese economic growth.

Looking ahead, U.S. crude futures were trading under $56 a barrel for the balance of 2019 and $53 in calendar 2020.

U.S. financial services firm Cowen & Co this week said that projections from the exploration and production (E&P) companies it tracks point to a 5% decline in capital expenditures for drilling and completions in 2019 versus 2018.

Cowen said independent producers expect to spend about 11% less in 2019, while major oil companies plan to spend about 16% more.

In total, Cowen said all of the E&P companies it tracks that have reported plan to spend about $80.5 billion in 2019 versus $84.6 billion in 2018.

Year-to-date, the total number of oil and gas rigs active in the United States has averaged 984. Most rigs produce both oil and gas.

Analysts at Simmons & Co, energy specialists at U.S. investment bank Piper Jaffray, forecast the average combined oil and gas rig count will slide from a four-year high of 1,032 in 2018 to 951 in 2019 and 906 in 2020 before rising to 957 in 2021.

That is a reduction from Simmons last forecast in late July of 970 in 2019 and 955 in 2020 and 997 in 2021.