Permian Basin Oil Production likely to peak in 2025

[dan_s]

Note this morning from HFI Research:

"We are seeing the final days of US shale oil production. When associated gas production starts to meaningfully outpace crude production, that's typically when the basin starts to peak. We are starting to see that now in the Permian. While we still expect minimal growth from US shale (+500k b/d from now to the end of 2025), that will be the bulk of the growth we see from the US.

Once the growth era of US shale finishes, we don't expect a steep drop-off in production. We expect producers to keep production flat for many years to come.

But as for the global oil markets, the lack of growth from US shale just as oil demand continues to inch higher will mean that higher oil prices will be needed to incentivize supplies from other sources. Without higher oil prices, we won't have supply growth like the ones we saw from 2014 to 2024.

Another Permian is not on the horizon to bail out the world. It's the end of an era."
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MY TAKE: I am all for Trump's plans to support more U.S. oil production, but "Drill Baby Drill" will not have the same result that it did during his first term. The U.S. energy plan should include completion of the Keystone XL pipeline ASAP and incentives for trucking companies to convert more trucks to run on compressed or liquified natural gas. The U.S. is blessed to have a massive amount of natural gas reserves. We will also need more heavy oil from Venezuela, so a leadership change in that country is necessary.