US crude oil production will decline in 2027 for the first time in six years, ending a run of record output that made the nation the world’s largest oil producer.
The Energy Information Administration projects US crude production will remain near the 2025 record of 13.6 million barrels per day in 2026 before falling 2% to 13.3 million barrels per day in 2027. The decline represents the first year-over-year drop in US oil output since 2021.
Falling rig counts threaten to outpace the efficiency gains that allowed producers to maintain record output despite drilling fewer wells. Active oil rigs dropped 33% from 750 in December 2022 to 397 in October 2025, according to EIA data. The agency expects the slowdown in drilling activity will outpace recent increases in drilling productivity.
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Oil prices below breakeven levels have forced operators to scale back drilling plans. The EIA forecasts West Texas Intermediate crude will average $52 per barrel in 2026 and $50 per barrel in 2027, well below the $61-62 per barrel breakeven range for new Permian Basin wells reported in the Dallas Federal Reserve energy survey.
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The Lower 48 states will drive the production decline, particularly outside the Permian Basin. The EIA expects modest production increases from the Gulf of Mexico and Alaska will fail to offset losses in other regions.
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