U.S. oil production to hit record amidst declining costs, drilling efficiencies, Macquarie predicts

(Bloomberg) – U.S. oil production is set to end the year at a record pace of about 14 MMbpd as falling costs and improved drilling efficiency overshadow subdued growth plans from publicly listed companies, Macquarie Group Ltd. analysts said in a note.

Macquarie stood out among analysts last year with its projection of increased U.S. shale production and ultimately was proved correct. Its latest forecast comes as shale-oil operators are vowing to rein in production growth for a fourth straight year and consolidation in the industry presents headwinds to further growth. The U.S. government expects production to edge up to 13.2 MMbpd this year.

Macquarie models U.S. production exiting 2025 at about 14.5 MMbpd, despite expectations for significantly lower crude prices.

“This year’s headwinds could flip to tailwinds in a scenario where the growth impulse from private companies recharges and public companies attack high-graded resource bases next year,” analysts led by Walt Chancellor said in the note.