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Released September 11, 2025 | SUGAR LAND
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Written by Daniel Graeber for Industrial Info Resources (Sugar Land,
Texas)--A significant decline in crude oil prices is expected over the coming months, which could lead to production declines, the U.S. Department of Energy said.
The price for Brent crude oil, the global benchmark, was trading near $67 per barrel early Wednesday, edging higher on geopolitical concerns after Israeli forces targeted Hamas leadership in U.S. ally Qatar. Though elevated by risk, macroeconomic concerns have prevailed for much of the year, pulling Brent down about 3.2% so far.
The U.S. Energy Information Administration (EIA), the data arm of the Energy Department, said in its monthly market report for September that it expected Brent to fall to about $59 per barrel by the fourth quarter, due in part to an oversupplied market.
By next year, Brent could average $51 per barrel, economists at the EIA wrote Tuesday.
"We expect low oil prices in early 2026 will lead to a reduction in supply by both OPEC+ and some non-OPEC producers, moderating inventory builds later in 2026," EIA's report read.
OPEC+ is the Organization of the Petroleum Exporting Countries (OPEC) and non-member state allies. They opted last weekend to unravel voluntary production curtailments earlier than anticipated, in what could be a coordinated push for market share.
The market headwinds on pricing might be showing up in the federal data. The EIA in its September report said it expected total U.S. crude oil production to average 13.4 million barrels per day (BBL/d) this year and fall to 13.3 million BBL/d by next year. Those numbers are higher than the August estimate, but only by about 10,000 BBL/d.
Offshore production is expected to average 1.84 million BBL/d this year and climb to 1.9 million BBL/d by next year. BP plc (London, England) last month added barrels with the startup of the Southwest Extension of its Argos platform, located in the Mad Dog Field. The extension is expected to add 20,000 barrels of oil equivalent per day (BOE/D) of gross peak annualized average production to the platform, whose gross production capacity is listed as up to 140,000 BBL/d.
Mad Dog is believed to contain the largest ultimate technically recoverable resources of any reservoir in U.S. federal waters. Subscribers to Industrial Info's Global Market Intelligence (GMI) Oil & Gas Production Project Database can learn more from a detailed project report.
Elsewhere, Alaska production is expected to increase as well, but only by a few thousand barrels to average 440,000 BBL/d.
The rest of the nation, including the lucrative shale basins, is in decline. Total inland production is expected to fall from the average of 11.18 million BBL/d this year to 10.96 million BBL/d by 2026. The bulk of the decline is from the Permian Basin, which is spread out over parts of Texas and New Mexico. Annual production there is expected to decline by about 1.7% to 6.41 million BBL/d.
Crude oil prices already are moving to a point at which many shale drillers can't make a profit. Referencing West Texas Intermediate (WTI), the U.S. benchmark for the price of oil, the Federal Reserve Bank of Dallas reported that many energy companies need WTI of at least $60 to increase production.
WTI is trading at about $3 per barrel less than Brent. The EIA expects WTI to trade about at $48 per barrel by next year. Natural gas prices, meanwhile, are moving in the opposite direction amid supply-side strains from exports of liquefied natural gas (LNG). The EIA in its September report said oil will trade this year at its lowest premium to natural gas since 2005.
"As a result, we expect drilling activity in the United States to be more centered in natural gas-intensive producing regions in 2026," the report read.
Nevertheless, gas production is expected to hold flat through next year, while oil production drops by around 1% annually.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
The price for Brent crude oil, the global benchmark, was trading near $67 per barrel early Wednesday, edging higher on geopolitical concerns after Israeli forces targeted Hamas leadership in U.S. ally Qatar. Though elevated by risk, macroeconomic concerns have prevailed for much of the year, pulling Brent down about 3.2% so far.
The U.S. Energy Information Administration (EIA), the data arm of the Energy Department, said in its monthly market report for September that it expected Brent to fall to about $59 per barrel by the fourth quarter, due in part to an oversupplied market.
By next year, Brent could average $51 per barrel, economists at the EIA wrote Tuesday.
"We expect low oil prices in early 2026 will lead to a reduction in supply by both OPEC+ and some non-OPEC producers, moderating inventory builds later in 2026," EIA's report read.
OPEC+ is the Organization of the Petroleum Exporting Countries (OPEC) and non-member state allies. They opted last weekend to unravel voluntary production curtailments earlier than anticipated, in what could be a coordinated push for market share.
The market headwinds on pricing might be showing up in the federal data. The EIA in its September report said it expected total U.S. crude oil production to average 13.4 million barrels per day (BBL/d) this year and fall to 13.3 million BBL/d by next year. Those numbers are higher than the August estimate, but only by about 10,000 BBL/d.
Offshore production is expected to average 1.84 million BBL/d this year and climb to 1.9 million BBL/d by next year. BP plc (London, England) last month added barrels with the startup of the Southwest Extension of its Argos platform, located in the Mad Dog Field. The extension is expected to add 20,000 barrels of oil equivalent per day (BOE/D) of gross peak annualized average production to the platform, whose gross production capacity is listed as up to 140,000 BBL/d.
Mad Dog is believed to contain the largest ultimate technically recoverable resources of any reservoir in U.S. federal waters. Subscribers to Industrial Info's Global Market Intelligence (GMI) Oil & Gas Production Project Database can learn more from a detailed project report.
Elsewhere, Alaska production is expected to increase as well, but only by a few thousand barrels to average 440,000 BBL/d.
The rest of the nation, including the lucrative shale basins, is in decline. Total inland production is expected to fall from the average of 11.18 million BBL/d this year to 10.96 million BBL/d by 2026. The bulk of the decline is from the Permian Basin, which is spread out over parts of Texas and New Mexico. Annual production there is expected to decline by about 1.7% to 6.41 million BBL/d.
Crude oil prices already are moving to a point at which many shale drillers can't make a profit. Referencing West Texas Intermediate (WTI), the U.S. benchmark for the price of oil, the Federal Reserve Bank of Dallas reported that many energy companies need WTI of at least $60 to increase production.
WTI is trading at about $3 per barrel less than Brent. The EIA expects WTI to trade about at $48 per barrel by next year. Natural gas prices, meanwhile, are moving in the opposite direction amid supply-side strains from exports of liquefied natural gas (LNG). The EIA in its September report said oil will trade this year at its lowest premium to natural gas since 2005.
"As a result, we expect drilling activity in the United States to be more centered in natural gas-intensive producing regions in 2026," the report read.
Nevertheless, gas production is expected to hold flat through next year, while oil production drops by around 1% annually.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
