Consulting firm Wood Mackenzie released a report indicating that US oil majors continue to hold a significant advantage in oil and gas exploration and production. This stems from their stronghold in the Permian Basin—a privilege European peers lack.
According to Wood Mackenzie data, crude oil and condensate production in the Lower 48 US states has hit a record high of 11.3 million barrels per day (b/d) but is nearing its peak. The firm forecasts a slow decline beginning by year-end, with output falling by 500,000 b/d by 2027. However, the outlook differs sharply for ExxonMobil and Chevron, which dominate the Permian Basin. Their growth trajectory remains robust and highly profitable.
The Permian’s competitiveness is undeniable. Wood Mackenzie notes that breakevens in the region fall below $45 per barrel. Combined with pricing advantages and ultra-low carbon intensity, the Permian is described as a “gift to upstream” that continues to generate value.
By 2030, ExxonMobil’s Permian output is projected to grow 55% to 2.3 million barrels of oil equivalent per day (boe/d), remaining stable through 2040. Chevron’s production is expected to rise 25% to 1.2 million boe/d by 2030. For both giants, the Permian contributes nearly one-third of total output. This onshore play offers not only low costs but also a mature infrastructure network.
Their strength lies not only in scale but also in resilience. Even as the total number of active US rigs declines, these energy giants continue to optimize well costs through AI and advanced analytics, steadily boosting recovery rates.
Market analysts from OilPrice.com add that the Permian’s strategic value extends beyond sheer scale. Unique geological conditions, infrastructure, and flexibility—including thousands of drilled but uncompleted wells (DUCs), ample pipeline takeaway capacity, and midstream networks—enable operators to adjust production faster than in any other global region.
In contrast, European majors face a different reality. They remain laggards in the Permian race, confronting high barriers to entry. OilPrice.com warns that unless European firms take bolder steps, the gap between US and European energy companies will widen further.