Crude oil production in Permian Basin is forecast by U.S. Energy Information Administration to increase to a record 4.95 million barrels per day in December, according to Monday’s drilling productivity report. EIA said Permian oil production in December is expected to be 4,953,000 b/d – up from 4,886,000 b/d in November – to surpass the basin record set in March 2020 before the pandemic curtailed global demand and triggered production shutdowns. Across the seven major U.S. producing regions, oil output is forecast to grow by 85,000 b/d from the previous month to 8,316,000 b/d in December.
Bloomberg said that the “bounceback has been driven by low break-even costs, and the largest U.S. drillers are almost exclusively focusing their limited domestic plans for expansion on the sprawling oil patch (Permian) at the expense of other shale basins. Total U.S. output is still a long way off from a full recovery.” Production in Eagle Ford in south Texas and Bakken in North Dakota still is below pre-pandemic level.
Production of natural gas also is forecast by EIA to increase next month by 226 million cubic feet per day to 89.376 billion cfd. Permian will grow by 87 million cfd to 19.385 billion cfd, Haynesville will increase by 111 million cfd to 13.889 billion cfd, and Appalachia will increase by 7 million cfd to 35.608 billion cfd.
The backlog of DUC wells (drilled but uncompleted) has declined to its lowest volume since 2014. EIA said Monday there were 5,104 DUC wells in the seven regions in October – down from 5,326 in September. Permian leads with 1,705 DUC wells – down from 1,812 in September.