US Crude Production Growth Slows as Oil Rigs Decline
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The U.S. expects crude production to grow by just 320,000 barrels a day next year, much slower than previously estimated.
While output is still poised to reach a record of 13.54 million barrels a day, the annual rate of growth is now projected at 2.4% versus 3.2%, the Energy Information Administration said in its Short-Term Energy Outlook Oct. 8. The slowdown comes after a surprise bumper increase last year.
Since then, the number of oil rigs operating in the U.S. has plummeted and is hovering near the lowest since late 2021, fueling expectations that shale producers will continue to prioritize shareholder returns over growth.
The trajectory of U.S. oil production has become a key factor for market participants gauging balances for next year, particularly as much of the growth is expected to coincide with the return of supplies from OPEC members and allies.
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The agency also revised lower its 2025 estimate for global oil demand, which is seen growing by 1.2 million barrels a day compared to last month’s estimate of 1.5 million barrels a day. Supplies, meanwhile, are seen holding steady, adding to a growing chorus of calls for an oversupplied oil market next year. The International Energy Agency projects that global demand will grow less than 1% in 2025.
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