World’s Top Oil Trader Sees Lower U.S. Output in 2025

U.S. oil production is set for a slight drop this year amid weaker prices, the chief executive of the world’s largest independent oil trader, Vitol Group, said on Tuesday. “With slightly lower prices ... we're beginning to see some impact on investment and production,” Vitol’s CEO Russell Hardy said at the Energy Asia conference in Kuala Lumpur, Malaysia, as carried by Reuters.“And there's nowhere more obvious for that than within the U.S. and within the shale industry,” the executive added. Hardy joins other industry executives in predicting that the U.S. shale patch will struggle to maintain the record-high production levels of the past months amid lower oil prices. U.S. shale production will likely plateau if WTI oil prices are in the low $60s per barrel, and decline at prices in the $50s, ConocoPhillips chairman and CEO Ryan Lance said last month. Executives polled in the Dallas Fed Energy Survey in Q1 indicated that their companies need an average $65 per barrel to profitably drill a new well.Last week, the U.S. Energy Information Administration (EIA) said in its June Short-Term Energy Outlook that total U.S. crude oil production is now forecast to slip from a record 13.5 million barrels per day (bpd) in the second quarter of 2025 to around 13.3 million bpd by the end of 2026. U.S. rig activity is tumbling. Last month’s rig count decline far exceeded expectations—the lowest since November 2021—with Baker Hughes reporting U.S. oil rigs at just 442 as of last week. In the Permian, the industry’s crown jewel, rig totals have fallen to levels not seen since late 2021. The Israel-Iran conflict is adding a lot of volatility and uncertainty on the oil market, driving WTI Crude prices above the $70 per barrel mark. However, without an actual supply disruption to oil supply and trade in the Middle Eastern region, oil prices will struggle to hold on to the $70s handle, according to analysts. By Tsvetana Paraskova for Oilprice.com