Goldman Says the Boom Years of U.S. Oil Output Growth Are Over, But Are They?

The U.S. oil industry has been a powerhouse of global energy production for over a decade, largely fueled by the shale revolution and the explosive growth in the Permian Basin. However, a recent analysis from Goldman Sachs has cast a shadow over this narrative. In an interview with Bloomberg TV, Daan Struyven, head of oil research at Goldman Sachs, declared that the “boom years” of rapid U.S. oil output growth are effectively over.

The bank’s projections point to potential declines in U.S. crude oil production for 2025 and 2026, driven primarily by the maturing of the Permian Basin and persistently lower oil prices. With WTI Crude hovering in the mid-$60s per barrel—a level affordable for consumers but marginally profitable for many producers—shale operators are adopting a cautious stance, prioritizing capital discipline over aggressive drilling.

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Goldman’s outlook hinges on several key factors. The Permian Basin, which has accounted for the lion’s share of U.S. production gains, is showing signs of maturity. As wells age and the most productive “sweet spots” are depleted, efficiency gains from technological advancements like longer laterals and improved fracking techniques are tapering off. Lower oil prices exacerbate this, as producers react swiftly to market signals, reducing rig counts and slowing new well completions. If prices remain in this range, Goldman anticipates U.S. production will “move sideways” with little to no growth, potentially leading to outright declines in the coming years.

Additionally, the bank is monitoring a growing surplus in global oil supplies, which could build inventories and exert further downward pressure on prices.But is this the full picture? While the Permian’s dominance is undeniable—it contributed to 46% of U.S. crude oil production in recent years—the story of American oil isn’t confined to one region.

Projections from the U.S. Energy Information Administration (EIA) and industry analysts suggest that while growth is slowing overall, the Permian itself is still expected to add around 300,000 barrels per day (b/d) in both 2025 and 2026, pushing output to 6.6 million b/d in 2025 and 6.9 million b/d in 2026.

This contrasts with Goldman’s more pessimistic view, highlighting a debate over how quickly the basin’s maturity will impact output. Moreover, U.S. crude production as a whole is forecast to inch up by about 120,000 b/d, reaching 13.5 million b/d by the end of 2025, according to some estimates.

Looking beyond the Permian, other basins offer pockets of potential that could offset any slowdown. The Bakken Shale in North Dakota, for instance, hit a new high in March 2025 with production at around 1,150 thousand b/d, though forecasts indicate a slight dip to 1,147 thousand b/d by May.

While not booming, the Bakken’s stability could provide a buffer. The Eagle Ford in South Texas and the Anadarko Basin (including the SCOOP/STACK plays) are facing flatter trajectories or modest declines, but they remain significant contributors. The rest of the Lower 48 states, encompassing basins like the Niobrara and Anadarko, are projected to produce about 2.07 million b/d in 2025.

Industry surveys from Permian operators indicate basin-wide crude growth of 306 thousand b/d (+4.8%) from 2024 to 2025, but incremental contributions from other areas could add to the national total.

As one analysis notes, while the Permian will drive most of the growth, other basins could chip in where efficiencies improve or prices rebound.

Perhaps the most intriguing wildcard is Alaska, where untapped potential in the National Petroleum Reserve-Alaska (NPR-A) could reignite growth. The Willow Project, operated by ConocoPhillips and approved in 2023, is a massive development expected to produce up to 180,000 b/d at peak, yielding around 590 million barrels over 30 years.

Construction is underway, with oil production potentially starting as early as year six of the project, putting initial flows online in the late 2020s.

Beyond Willow, ConocoPhillips recently filed applications (as of July 14, 2025) to drill additional exploration wells in the eastern NPR-A, signaling confidence in “vast reserves” that could extend beyond current projects.

The NPR-A, spanning 23.5 million acres, holds significant untapped potential, and expanded leasing could boost Alaska’s output, which has been declining but could reverse with these developments.

This isn’t just about oil; Willow alone is projected to generate $8 billion to $17 billion in revenue for federal, state, and local governments.

In the end, Goldman’s warning about the end of the boom years raises valid points about the challenges ahead, particularly in the Permian. Yet, it may understate the resilience of the U.S. oil sector. As Stu Turley aptly observes, “A country’s oil output is not defined by one basin, but rather the entire geological structure across basins.” Coupled with the United States’ new Energy Dominance mantra, we now have to look at our oil and gas exploration and oil field service companies as extensions, as they are doing more work abroad. Their impact will be on the global production, and somehow, the U.S. should get credit for their production influence and numbers. 

As for me and my house, we will invest in low-cost energy in the United States through oil and gas deals with tax benefits.