By Ovi
All of the Crude plus Condensate (C + C) production data for the US state charts comes from the EIAʼs Petroleum Supply monthly PSM which provides updated production up to June 2025.
U.S. June oil production increased by 37 kb/d to 13,792 kb/d, The largest increase came from the GOM, 88 kb/d, while the largest decrease came from Texas, 75 kb/d. July production is expected to rise by 29 kb/d to 13,821 kb/d according to the August STEO. Production is expected to drop every month going forward up to October 2026.
The dark blue graph, taken from the August 2026 STEO, is the U.S. oil production forecast from July 2026 to December 2027. Output for December 2027 is expected to rise to 14,226 kb/d, revised up by 86 kb/d from the July STEO report. From July 2026 to December 2027 U.S. oil production is expected to increase by 405 kb/d but peaks in mid-year 2027
The light blue graph is the STEO’s forecast for the Onshore L48 output to December 2027. June Onshore L48 production decreased by 48 kb/d to 11,381 kb/d largely due to production drops in Texas and New Mexico. From July 2026 to December 2027 production is expected to increase by 495 kb/d to 11,853 kb/d. Note how production is essentially flat out to February 2027. The 2027 production increase may be due to the recent addition of 20 Hz oil rigs into Eddy county. Check Eddy county oil rig count further down.
U.S. Oil Production Ranked by State
Listed above are the 10 US states with the largest oil production along with production from the Gulf of Mexico.
These 10 states accounted for 82.7% of all U.S. oil production out of a total production of 13,792 kb/d in June 2026. On a MoM basis, June oil production in these 10 states dropped by 39 kb/d. On a YoY basis, US overall production increased by 182 kb/d with the largest contributor being New Mexico.
State Oil Production Charts
Texas’ June oil production decreased by 75 kb/d to 5,728 kb/d according to the EIA. This is a larger than normal, non weather related, one month decrease. YoY production dropped by 28 kb/d.
The Texas’ RRC initial production for June, orange graph, dropped by 610 kb/d from May to 4,651 kb/d. The projection added 711 kb/d to June’s initial production to raise it to 5,362 kb/d, 366 kb/d lower than the EIA estimate.
The red graph is a production projection using the preliminary May and June Texas RRC data.
The blue graph shows the average number of weekly rigs reported for each month shifted forward by 8 months. So the 257 rigs operating in January 2024 have been shifted forward to September 2024. From March 2025 to May 2026, the rig count dropped from 234 in time shifted March to 189 in May 2026. That drop of 45 rigs has had little impact on Texas production up to May 2026. The larger than normal June production drop may be the first indication that the dropping rig count is starting to have an impact on production.
According to the EIA, New Mexico’s June production dropped by 32 kb/d to 2,367 kb/d. YoY production rose by 148 kb/d, 176 kb/d more than Texas.
The red graph shows NM’s projected output up to June and is calculated using the preliminary May and June NM OCD production. June projected production decreased by 18 kb/d from May to 2,248 kb/d and is 19 kb/d lower than the EIA’s reported June production of 2,367 kb/d. The EIA’s production and the projection numbers have the same trend.
Production in both Lea County and Eddy County is reported below. See Permian section further down.
GOM production rose by 88 kb/d in June to 1,998 kb/d. It is up by 86 kb/d YoY.
The August 2026 STEO GOM projection has been added to this chart. For July production is projected to rebound to 2,010 kb/d, an increase of 12 kb/d. It also projects production in December 2027 will be lower than 2,000 kb/d at 1,861 kb/d.
Permian Basin Report for Main Counties and a District
This special monthly Permian section was added to the US report because of a range of views on whether Permian production will continue to grow or will peak over the next year or two. The issue was brought into focus many months back by two Goehring and Rozencwajg Reports and Report2 which indicated that a few of the biggest Permian oil producing counties were close to peaking or past peak.
A more recent report was issued and can be reviewed Here. In this report they state:
“For years now, we have outlined with what we hoped was clarity, and what we now submit was prescience, the view that U.S. shale oil, that great source of modern supply, could not grow forever. It would mature, crest, and begin its long descent. That moment, by our models and measures, has arrived: shale has plateaued, and 2024 appears to be its high-water mark. And yet, investor sentiment has scarcely been more downbeat.”
This section will focus on the four largest oil producing counties in the Permian, Lea, Eddy, Midland and Martin. It will track the oil production and the associated Gas Oil Ratio (GOR) on a monthly basis. The data is taken from the state’s government agencies for Texas and New Mexico. Typically the data for the latest two or three months is not complete and is revised upward as companies submit their updated information. Note the GOR shown in the charts uses the gas coming from both the gas and oil wells.
Of particular interest will be the charts which plot oil production vs GOR for a county to see if a particular characteristic develops that indicates the field is close to entering or in the bubble point phase. While the GOR metric is best suited for characterizing individual wells, counties with closely spaced horizontal wells may display a behaviour similar to individual wells due to pressure cross talking . For further information on the bubble point and GOR, there are a few good thoughts on the intricacies of the GOR in an earlier POB comment and here. Also check this EIA topic on GOR.
New Mexico Permian
The Hz oil rig count in Lea County after stabilizing at 33 over the last 8 weeks has risen to 37 over the past month. Over the past six months Lea County dropped 30 rigs to 33 while Eddy added 15 Directional rigs in June. Actually the 15 Drigs operating in Eddy county were re-classified to Hz rigs in July. This is a significant addition to drilling capacity and future production regardless of whether they were Hz or Drigs. Since early July the rig count has dropped from 56 to 49 in late August.
Oil Production in New Mexico’s Primary Permian Counties
Lea County’s oil production started its plateau phase in April 2024 at 1,202 kb/d and it continued to October 2025. November 2025 to January 2026 saw steady production drops in both the projected and NM OCD’s preliminary production. However the majority of January’s projected production drop of 66 kb/d was due to the severe January weather. February projected production rebounded and continued to rise due to more drilling and peaked in May 2026 at 1,259 kb/d. June projected production decreased by 29 kb/d to 1,230 kb/d
With Lea’s increased production to 1,259 kb/d in May paralleling the time shifted rig count, it now appears more likely that the projected production increases from March to May are related to the time shifted increasing rig count. Note that from time shifted April 2026 to July 2026 the rig count increased from 46 to 61.
Preliminary June data from New Mexico’s Oil Conservation Division (OCD) indicates Lea County’s June oil production dropped by 42 kb/d to 1,164 kb/d, green graph.
The blue graph shows the average number of weekly rigs operating during a given month as taken from the weekly rig data. The rig graph has been time shifted forward by 7 months. So the 64 Rigs/wk operating in August 2023 have been time shifted forward to March 2024 to show the possible correlation and time delay between rig count, completion and oil production.
Note that rig counts are being used to project production as opposed to completions because state completion data is not available. Completion data from the Drilling Productivity report below indicates that the decline rate now exceeds production from new wells in the Permian basin.
After much zigging and zagging, oil production in Lea county stabilized just below 1,100 kb/d in early 2023. Once production reached a new high in January 2023, production appeared to be on a plateau while the GOR started to increase rapidly to the right and first entered the bubble point phase in July 2023.
Since July 2023 Lea County’s production continued to increase as the GOR remained within a second semi-bounded region. This may indicate that additional production was coming from an oilier part of a layer since the GOR’s behaviour since August 2023 to March 2024 time frame appears once again to be in a second semi bounded GOR phase accompanied with rising production.
The GOR moved out of the second semi-bounded GOR region in April 2024 and production hit a new high of 1,221 kb/d in August 2024. February 2026 through May 2026 saw a double change in direction, i.e. both a production increase and a GOR decrease to 3.82. June production reversed this trend and production dropped and the GOR increased to 3.93, another indicator that Lea County production may have peaked.
This zigging and zagging GOR pattern within a semi-bounded GOR while oil production increases to some stable level and then moves out to a higher GOR to the right has shown up in a number of counties. See a few additional cases below.
Eddy’s June projected oil production came in at 1,076 kb/d while preliminary production from the NM OCD came in at 1,070 kb/d. Most of the February production rise was due to a rebound from the severe January weather. If the storm had not occurred January production would have been closer to 1,100 kb/d.
The dropping rig count starting in time shifted January 2026 may have finally shown up in falling production in real March followed by steady production to June 2026. Production at this level may hold around 1,070 kb/d as the rig count steadies around 35.
The blue graph shows the average number of weekly rigs operating during a given month as taken from the above weekly drilling chart. The rig graph has been shifted forward by 7 months to roughly coincide with the increase in the production graph starting in September/October 2023.
Between May 21, 2026 and July 3, 2026, 15 Directional Rigs, later reclassified to Hz rigs, were added to Eddy County. These additional rigs should provide a significant boost to Eddy oil production starting near year end or early 2026.
The Eddy county GOR pattern is similar to Lea county except that Eddy broke out from the first semi bounded range earlier and then added a second wider semi-bounded GOR phase.
For June New Mexico’s Oil Conservation Division (OCD) reported preliminary oil production was 1,070 kb/d while the GOR rose to 5.39 and remained in the second Semi-Bounded GOR range.
Texas Permian
The rig count in Midland county remained essentially unchanged for twelve weeks at 22 up to early July but then dropped to 19 at the end of July and into late August. Martin county’s rig count has bounced around 24 since the beginning of the year except for two weeks ago when the rig count dropped to 18.
Oil Production in the Two Primary Texas Permian Counties
Last month the Texas RRC upgraded their reporting system and the reported results could not be used to make a production projection. The August data which is consisted with the May production is much better.
June projected production dropped by 30 kb/d to 631 b/d. The February rise is due to the production rebound from the severe Texas winter storm in late January. In the April report it was noted that “With the rig count rising in time shifted February and March from the January low, the February and March preliminary increases may be directionally correct”. The RRC August report confirms that the preliminary production rise to April was real, green graph.
April appears to be peak production for Midland county since May and June had large drops.
The orange and green graphs show preliminary oil production for Midland County as reported by the Texas RRC for May and June respectively. The red graph uses May and June production to project production as it would look after being updated over many months.
The blue graph shows the average number of weekly rigs operating during a given month as taken from the weekly drilling chart. The rig graph has been shifted forward by 6 months to better align with the latest production.
For June the Midland GOR ratio rose to a new high of 4.86 while the reported preliminary oil production dropped by 45 kb/d to 583 kb/d.
When the Midland county GOR initially moved into the bubble point phase, oil production and the GOR stayed within a narrow GOR range of 3.8 to 4.2 outside of the initial Semi-Bounded GOR region from March 2024 to December 2025. For June the GOR rose to a new high of 4.86, which is another indicator of dropping production shown in the production chart above.
The oil production and GOR shown in this chart are based on the RRC’s August preliminary production report.
Comparison chart from previous report.
In the previous report, it was noted that the production projection for Martin County was overly optimistic due to a change in reporting by the Texas RRC. The August data is back to normal. Compare the current August chart with the previous comparison chart above starting in January 2026.
Martin’s projected June oil production dropped by 16 kb/d to 722 kb/d. Production has been in a steady decline since November 2025 when production reached 759 kb/d.
The red graph is a projection for oil production as it would look after being updated over many months. This projection is based on a methodology that uses preliminary May and June oil production data.
The orange and green graphs show production for Martin County as reported by the Texas RRC for May and June. The blue rig graph time shifts the rig count forward by 5 months.
Martin county’s oil production after November 2022 increased and at the same time drifted to slightly higher GORs within the semi bounded range. However the June 2024 GOR saw its first move out of the semi bounded region.
The RRC’s preliminary June 2026 production for Martin County shows a 32 kb/d decrease to 664 kb/d accompanied by an increase in the GOR to a record 3.33.
Martin county has the lowest semi-bounded GOR boundary of the four counties at a GOR of close to 2.55. The June GOR is now clearly out of the semi-bounded region. Martin County has now entered the bubble point phase that should result in a plateau phase that is currently turning into a slowly dropping oil production phase.
Texas District 8
District 8’s projected production dropped by 53 Kb/d to 3,704 kb/d in June. District 8 appears to be entering its declining phase. Note how June preliminarily production, green graph, is lower than May preliminary production, orange graph.
District 8 contains Martin and Midland counties along with a few more of the largest producing counties. District 8 projection may be slightly on the optimistic side..
Plotting an oil production vs GOR graph for a district may be a bit of a stretch. Regardless here it is and it seems to indicate many District 8 counties may well be into the bubble point phase. The June GOR rose to a new high of 4.74. Preliminary production continued to drop to 3,066 kb/d.
Drilling Productivity Report
The Drilling Productivity Report (DPR) uses recent data on the total number of drilling rigs in operation along with estimates of drilling productivity and estimated changes in production from existing oil wells to provide estimated changes in oil production for the principal tight oil regions. The new DPR report in the STEO provides production up to June 2026. The report also projects output to December 2027 for a number of basins. The DUC charts and Drilled Wells charts are also updated to June 2026.
The DPR has made significant downward changes to the oil production forecasts for the three combined tight oil basins, Permian, Eagle Ford and Bakken reported here. It is not clear if the decreases are related to the sudden drops in the WTI oil price from over $100/barrel in April 2026.
Comparison chart from previous report.
The EIA’s August STEO/DPR report shows Permian June output rose by 1 kb/d to 6,801 kb/d. August production is expected to increase by 10 kb/d to 6,811 kb/d. From July 2026 to December 2027 output is expected to increase by 295 kb/d to 7,096 kb/d. December 2027 production has been revised up by 3 kb/d from the previous report.
However, the 3 kb/d revision is not a significant increase. What is significant is the shape of the projection when compared to the previous post and shown in the comparison chart above. In the August report, Permian production stops growing and enters a plateau phase in October 2027 where it peaks at 7,100 kb/d whereas in the previous chart production continues to grow.
Note that production begins to rise from February 2027 to October 2027. According to the EIA, this is due to more NG pipelines being built. The gas pipelines are needed to capture the associated flared gas coming from new oil wells. Also the production increase starting in February is also related to increased drilling.
Production from new wells and legacy decline, right scale, have been added to this chart to show the difference between new production and legacy decline. Currently, decline is larger than new production which results in the October 2027 peak.
These numbers reflect a one year production trend and provide the production contribution from new wells over a rolling 12-month period to determine if the rate of new production is increasing or decreasing compared to previous periods. The averaging process approximately adds a six month delay.
This chart plots the combined production from the three main LTO regions. July output increased by 7 kb/d to 9,153 kb/d. August is expected to add 13 kb/d to 9,166 kb/d. Production for December 2027 is forecast to be 9,500 kb/d, revised up by 4 kb/d from the previous report but more importantly shows the same new flattening trend as the Permian.
DUCs and Drilled Wells
The number of DUCs available for completion in the Permian and the three major DPR regions continues its dropping trend. The July DUC count for the three basins dropped by 8 to 1,460. In the Permian the DUC count dropped by 1 to 824..
In the three primary regions, a total of 670 wells were completed in July, 14 more than in June There were 663 wells drilled in July 2026, up 11 from June 2026.
In the Permian, 484 wells were completed in July and 484 were drilled. Drilling and completions have been increasing since March.
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