Once again, the Permian Basin is expected to lead growth in the nation’s overall oil production.
The Energy Information Administration forecasts that crude production from the Permian Basin will average about 6.3 million barrels per day this year, an increase of 8% over 2023 and accounting for nearly half of all crude production. Permian production will contribute about two thirds of all US oil production through the end of 2025, according to the EIA’s June Short-Term Energy Outlook. The EIA expects increased production from the Permian, as well as other regions, will drive US production to record highs in both 2024 and 2025.
“The Permian region’s proximity to crude oil refining and export terminals on the Gulf Coast, established takeaway capacity and improved new well productivity support crude oil production growth in the region,” the EIA wrote in its June 2024 Short-Term Energy Outlook.
“Without a doubt, the mighty Permian Basin is the major factor that makes Texas the 8th largest economy in the world,” Todd Staples, president of the Texas Oil & Gas Association, commented to the Reporter-Telegram by email.
“The Permian Basin leads US energy production, single-handedly contributing nearly 45% of domestic oil production, thanks to its phenomenal reserves, private sector investment in infrastructure and Texas’ welcoming business climate that includes a stable regulatory environment,” he continued.
Staples added, “The West Texas spirit has taken this vast resource and persevered through difficult years to make the Permian Basin the most important basin in the world today as it is producing record amounts of oil and natural gas that is fueling modern life here at home and around the world, all while making tremendous environmental progress. You do not have to live in the Permian Basin to benefit from the extraordinary contributions this region is making to fund public schools, universities, roads and first responders.”
The EIA has expanded its Short-Term Energy Outlook forecasts to include regional trends in the primary oil and natural gas production regions in the United States — Appalachia, Bakken, Eagle Ford, Haynesville, and Permian.
“Incorporating regional forecasts of oil and natural gas production helps us tell a more comprehensive story of hydrocarbon production trends in the United States,” said EIA Administrator Joe DeCarolis. “Consider the natural gas market, where we’ve seen prices decline far more rapidly than production. We knew that associated natural gas, which is produced as a byproduct of increasing crude oil production, was a driver of relatively stable natural gas production. Now our forecasts clearly show the important regional relationship of oil and natural gas production.”
EIA expects U.S. marketed natural gas production to decrease slightly more than 1% in 2024 in response to low natural gas prices. Production is forecast to increase in the Permian, Bakken, and Eagle Ford regions this year, while declining in the other major producing regions.
