The Oil Industry Is Facing A Problem - CleanTechnica

The article from CleanTechnica highlights a growing challenge within the U.S. oil industry, based on data from the U.S. Energy Information Administration (EIA). While crude oil and natural gas production in the Lower 48 states (L48) has increased, the volume of production declines from existing wells has also risen, necessitating the continuous drilling of new wells to maintain or grow output. Notably, newer horizontal wells, which dominate recent drilling efforts, exhibit faster decline rates than traditional vertical wells, meaning they deplete more quickly and require more frequent replacement. In December 2024, despite declines from older wells, production was sustained by over 15,000 new wells, predominantly horizontal, which collectively produced enough oil to offset these losses. However, the article points to a looming problem: global oil demand may have peaked or is on a downward trajectory, driven in part by accelerating vehicle electrification, especially in markets like China where over half of new vehicle sales are plug-in electric vehicles.