Energy executives predict a significant slowdown in oil output growth from the U.S. Permian basin in 2025, despite President Donald Trump’s commitment to maximizing production. The forecast indicates a decline of at least 25% in growth compared to previous years.
Key Highlights:
Production Projections:
Executives at a recent Houston conference estimate that Permian production will increase by 250,000 to 300,000 barrels per day (bpd) in 2025, down from a 380,000 bpd increase in 2024.
This aligns with the U.S. Energy Information Administration’s projection of a 300,000 bpd rise.
Current Output Levels:
Total Permian output reached 6.3 million bpd last year, representing about 50% of total U.S. oil production.
Statements from Industry Leaders:
Barbara Harrison, vice president at Chevron, noted, “We still expect to see growth in the Permian but we expect to see that moderated versus the rate of growth we have seen before.”
Chevron reported a 14% year-over-year increase in Permian production, reaching a record 992,000 barrels of oil equivalent per day (boepd), nearing their target of 1 million boepd.
Future Growth Expectations:
Harrison indicated that Chevron anticipates a growth rate of 9-10% in the coming years, emphasizing a more measured approach compared to the aggressive expansion seen in the past.
CEO Mike Wirth stated that Permian operators are likely to maintain modest capital spending, contrasting with the previous decade’s “drill, baby, drill” mentality.
Market Dynamics:
Shannon Flowers from Coterra Energy highlighted the tension between the administration’s desire for lower energy prices and the needs of producers, stating, “That’s not necessarily good for producers.”
Delek’s CEO Avigal Soreq echoed this sentiment, noting that producers are focused on controlling capital spending and achieving higher prices for their products.
Overall U.S. Production Trends:
The U.S. remains the world’s top oil producer, with an output of approximately 13.2 million bpd in 2024. However, total production growth has slowed, with an increase of only 280,000 bpd last year.