U.S. oil output from top shale-producing regions is on track to fall for a third month in a row in October to the lowest level since May 2023, the U.S. Energy Information Administration (EIA) said in its monthly drilling productivity report on Monday.
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U.S. oil output is expected to fall to 9.393 million barrels per day (bpd) in October from 9.433 million bpd in September, EIA data showed. A record 9.476 million bpd was hit in July.
The estimated decline of about 40,000 bpd would be the biggest monthly drop since December 2022.
Crude output in the Permian Basin in Texas and New Mexico, the biggest U.S. shale oil basin, is expected to fall by nearly 26,000 bpd to 5.773 million bpd, which would be the lowest level since April.
Crude production in the South Texas Eagle Ford region is due to fall by 17,000 bpd to 1.109 million bpd, which would be the lowest level since December 2022.
However, oil production in the Bakken region of North Dakota and Montana is due to rise by about 3,000 bpd to 1.227 million bpd, which would be the highest level since November 2020.
Despite a couple of weekly oil and natural gas rig increases, the U.S. rig count was still down about 122, or 16%, below this time last year, according to data from U.S. energy services firm Baker Hughes (BKR.O).
That’s because U.S. exploration and production firms were still more focused on returning money to investors and paying down debt than just boosting oil and gas production.
U.S. oil and gas production, however, is on track to reach record highs in 2023 and 2024 due in part to rising oil pries.
U.S. oil futures , have been trading around their highest prices since November 2022, and are up about 14% so far this year after gaining about 7% in 2022. U.S. gas futures , meanwhile, have plunged about 39% so far this year after rising about 20% last year.
Total gas output in the big shale basins will slip by 0.3 billion cubic feet per day (bcfd) to 98.4 bcfd in October from 98.7 bcfd in September, EIA projected.
That puts gas output on track to fall for a record third month in a row, according to EIA data going back to 2007, and compares with a record 99.1 bcfd in May 2023.
In the biggest shale gas basin, Appalachia in Pennsylvania, Ohio and West Virginia, output is set to ease to 35.7 bcfd in October, the lowest level since April.