EIA: Permian Basin to help drive record oil production levels in 2024, 2025

According to the U.S. Energy Information Administration (EIA), crude oil production in the Permian Basin, which spans western Texas and southeastern New Mexico, is expected to rise by nearly 8% this year. The basin accounts for nearly half of U.S. crude oil production.

On Tuesday (June 11), the EIA released the June Short-Term Energy Outlook that shows crude oil production in the Permian Basin will average about 6.3 million barrels per day in 2024, up almost 8% from 2023. The increased production in this and other regions will contribute to successive crude oil production records in the United States in 2024 and 2025.

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.”

Because of low natural gas prices, U.S. marketed natural gas production is projected to fall more than 1% in 2024. Production is expected to rise in the Permian, Bakken and Eagle Ford regions this year while declining in the other major producing regions.

Following are other highlights in the Short-Term Energy Outlook:

• U.S. electricity consumption in the commercial sector is expected to rise by 3% this year amid expectations for increased power demand from data centers.
• U.S. residential electricity bills are projected to be similar to last summer, with average monthly bills this summer of $173 compared to $168 last summer. The national average price of electricity will be about the same this summer as last summer, but the average U.S. household will consume more electricity – primarily to power air conditioning.
• U.S. distillate fuel consumption is expected to rise by 1% in the second half of this year compared to the same period last year. The rise can be attributed to increased manufacturing leading to more on-highway trucking – the single largest end use of distillate fuel oil.