Lower 48 oil production — long a symbol of energy independence and geopolitical leverage — is entering a period of profound fragility as crude prices stagnate below levels needed to sustain growth.
With West Texas Intermediate (WTI) crude hovering near $63 USD a barrel and Brent below $66, the “lower-for-longer” price environment is placing US shale producers under increasing strain, threatening the viability of future output growth.
That’s according to ConocoPhillips‘ CEO Ryan Lance, who warned this week that shale output is likely to plateau or even decline if oil prices were to drop well into the $50s.
Speaking at the Qatar Economic Forum on the heels of US President Donald Trump’s state visit there, Lance said: “The breakeven probably hasn’t moved a lot. Long-term, if you’re going to say oil prices in a comfortable range — maybe in the $65 to $75 range — we’ll still see continued modest growth out of the US.”
Without another breakthrough in drilling technology, however, he cautioned that US production could peak by the end of this decade.
The impact is particularly acute in the Permian Basin, the engine room of America’s oil boom. The region, which accounts for roughly half of US crude output and nearly all of its production growth, is showing signs of fatigue.
Once expected to add as much as 1 million barrels per day (bpd) of new supply this year, revised forecasts now show a marked slowdown — a direct response to weakening prices and increased output from OPEC+ nations.
This bleak outlook undercuts Trump’s once-rallying cry of “drill baby drill,” exposing the structural limitations of US shale to respond to prolonged price weakness.
Lance’s remarks come as global producers brace for shifting supply dynamics.
While US output falters, Canada is emerging as a major non-OPEC contributor to global supply growth in 2025 — a rare bright spot in North American production.
Meanwhile, OPEC+ has announced a fresh increase of 411,000 bpd in June, with Saudi Arabia hinting at more additions to pressure non-compliant members like Iraq and Kazakhstan and to reassert dominance over price formation.
The consequences are stark. According to Baker Hughes, US rig activity remains subdued, with active oil rigs dropping near multi-year lows.
The latest Energy Information Administration (EIA) data shows US crude inventories below the seasonal five-year average, while production has edged up only marginally, reaching 13.39 million bpd, still short of the December 2023 record.
Moreover, crude markets were rattled by the downgrade of US debt by Moody’s and news of a potential thaw in Russia-Ukraine tensions following a call between Trump and Vladimir Putin on the weekend.
Despite turbulence, some energy leaders remain optimistic about the long-term demand trajectory — particularly for liquefied natural gas (LNG).
Speaking alongside Lance, Qatar’s Energy Minister Saad al-Kaabi emphasized that LNG markets are expected to expand from 400 million tonne to over 700 million tonnes annually within the next decade, with strong demand growth from China and India.
Still, for US oil producers, the challenge is sobering. Without a rebound in prices to the mid-$70s, the shale revolution that reshaped global energy markets could begin to unwind — bringing with it consequences not just for domestic energy security, but for global supply balance.
In a new era of contested market share and capital discipline, the US oil sector faces a reckoning. Its ability to adapt may once again depend on the same forces that launched the boom: innovation, resilience, and the price of oil.
