ARKANSAS, January 17 (Future Headlines)- The U.S. Energy Information Administration (EIA) has reported that oil output from the top shale-producing regions in the country is poised to decline in February for the fifth consecutive month. According to the agency’s monthly Drilling Productivity Report, U.S. oil output is expected to fall to 9.68 million barrels per day (bpd) next month. This decline is driven by reduced production in key regions such as Eagle Ford and Bakken, coupled with lower growth in the Permian Basin, the nation’s top-producing region.
The Drilling Productivity Report highlights specific projections for oil output in various shale basins. In the Permian Basin, which is the largest U.S. shale region, oil production is anticipated to reach 5.974 million bpd in February, marking a record high. However, the growth in Permian output is expected to be the smallest since June.
Conversely, the Eagle Ford region is projected to experience a decline in oil production, falling to 1.147 million bpd – the lowest in a year. In the Bakken region, output is set to decrease to 1.303 million bpd, reaching the lowest level since December. The report’s findings had a limited impact on oil futures, with U.S. West Texas Intermediate (WTI) crude futures edging 28 cents lower to $72.40 per barrel, while the global benchmark Brent Crude futures gained 14 cents, reaching $78.29 per barrel.
Additionally, the report includes insights into natural gas output in major shale basins. The EIA projects a decline of approximately 0.2 billion cubic feet per day (bcfd) in total natural gas output, reaching a five-month low of 98.9 bcfd in February. This decline comes after the record monthly gas output of 100.0 bcfd in October 2023. The February estimate puts natural gas output on track for a record fourth consecutive monthly decline.
In the Appalachia basin, spanning Pennsylvania, Ohio, and West Virginia, natural gas output is expected to slide by 0.2 bcfd to 35.5 bcfd in February. This would be the lowest output level since April 2023, following the record high of 36.3 bcfd in August 2023. The EIA predicts that new Appalachia gas well production per rig will rise to a 21-month high of 26.7 per million cubic feet per day (mmcfd) in February.
The agency’s report also provides insights into well drilling and completion activities. In December, producers drilled 862 oil and gas wells and completed 926, marking the lowest completion rate since February 2023. The total number of drilled-but-uncompleted (DUC) oil and gas wells dropped by 64 to 4,374 in December, reaching the lowest level on record based on EIA data dating back to December 2013.
The decline in shale oil output reflects ongoing trends in the U.S. energy landscape, influenced by factors such as production dynamics, market conditions, and regulatory environments. These insights provide valuable information for stakeholders, including industry participants, policymakers, and investors, to understand the evolving dynamics of the U.S. shale sector and its broader implications on energy markets.
Reporting by Moe Khaled; Editing by Sarah White