Rystad Energy - Energy Knowledge House
Rystad Energy - Energy Knowledge House

Press Release

US shale oil output set to drop in 2020 as cuts forecast to reach more than 2 million bpd in last quarter

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Due to the combined effect of the Covid-19 pandemic and the low oil prices, US shale operators are reducing spending, production and overall activity in 2020. Although the country’s oil production was previously poised for annual growth of 8.1%, based solely on interpretation of operators’ guidance, Rystad Energy is projecting a decline of at least 2.7% year-on-year (US Lower 48 excl. Gulf of Mexico).

As shut-ins, reductions in spending and activities weigh in, the fourth quarter of 2020, which was projected to see a year-on-year oil production increase of 650,000 barrels per day, is now instead forecast to see a reduction of 1.5 million bpd. In other words, production for the quarter will be lower by some 2.15 million bpd compared to what was expected before the Covid-19 crisis.

US oil production in the fourth quarter of 2019 averaged around 10.4 million bpd. For all of 2020, it is now expected to fall to about 9.6 million bpd from 9.9 million bpd in 2019. These numbers are, as stated above, based solely on company guidance, and our own 2020 forecast is slightly more pessimistic as we expect production to decline further to 9.5 million bpd, down around 4% from 2019.

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“The production slide in 2020 may accelerate even further, as private operators are likely to respond faster with decisions of additional activity cuts. Also, production curtailments that could be implemented by a larger number of operators could lower the actual oil output even more,“ says Rystad Energy Vice President North American Shale and Upstream Veronika Akulinitseva.

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Learn more in Rystad Energy’s ShaleWellCube.

Over the last weeks, Rystad Energy has registered additional capital budget reductions communicated by a number of US shale operators. In total, all revised US shale producers combined have so far reported plans to slash 38% off their previously announced 2020 capital budgets, which implies a cut of nearly 42% compared to 2019 spending.

Some of the producers have clearly communicated new expected oil production volumes for the year, while the potential impact for the others has been estimated by Rystad Energy’s shale team.

It should be noted that these numbers could represent rather conservative estimates as the approach used assumes the same impact on wells put on production (POPs) as on spudded wells and does not account for additional acreage upgrading, increased focus on sweet spots and potential production efficiencies that are likely to be realized by these producers.

For more analysis, insights and reports, clients and non-clients can apply for access to Rystad Energy’s Free Solutions and get a taste of our data and analytics universe.



Veronika Akulinitseva
Vice President North American Shale and Upstream
Phone: +47 24 00 42 00


Lefteris Karagiannopoulos
Media Relations Manager
Phone: +47 90228994


About Rystad Energy
Rystad Energy is an independent energy research and business intelligence company providing data, tools, analytics and consultancy services to the global energy industry. Our products and services cover energy fundamentals and the global and regional upstream, oilfield services and renewable energy industries, tailored to analysts, managers and executives alike. Rystad Energy’s headquarters are located in Oslo, Norway with offices in London, New York, Houston, Aberdeen, Stavanger, Moscow, Rio de Janeiro, Singapore, Bangalore, Tokyo, Sydney and Dubai.