We wanted to share our latest production update, covering our revised Long term Forecast for oil and natural gas as well as general model updates. View the full update on the Energy Dashboard and tune into our Quarterly Production Webinar, this morning at 10am EST. 

This quarter's update is modest, mostly driven by changes in the short-term/actuals. 

Overall and Producer Commentary

Rig service providers continue to guide to increased activity in the second half of 2026 from the oil side.  Regardless of activity levels, the Lower 48 increased efficiency story continues to allow producers to get more hydrocarbons with the same Capex even more so in 2026 as compared to 2025.

It has also become clear that the 2026 Atlantic Hurricane season will be very restrained (only a small handful of seasons  have recorded first hurricanes this late, and currently, the one potential system has no chance of becoming on).  As a consequence, we have reduced our expected impact to GOM production for this year.

Some commentary from producers:

"During the quarter, we drilled the longest lateral in the history of shale development at more than 29,000 feet, all while staying 100% in zone with zero safety incidents." - Toby Rice, CEO, EQT

"Our base contracted electric frac fleet achieved efficiencies of nearly 14 stages per day. Additional records included the most RRC stages performed in one day for a single crew at 20, and the highest pumping hours in one day at 22 hours." - Dennis Degner, CEO, Range Resources

"We achieved $3 billion of structural cost reductions over the past 12 months, reaching our target six months ahead of schedule. More than 70% of the savings came from efficiency gains, underscoring the quality of the improvements delivered." - Mike Wirth, CEO, Chevron

"Year-to-date drilling feet per day is up 13%, and completed lateral feet per day is up 5%. These efficiency gains are contributing to well cost reductions. We have reduced direct well costs by $15 per foot, averaging less than $710 per foot." - Ezra Yacob, CEO, EOG Resources

"All of our frac fleets are currently electric. We think inflation is about 1% of our total well cost, and we can offset it with efficiency gains. The next bogey for us is how we get to achieving 5,000 feet per day across all crews every day." - Travis Stice, CEO, Diamondback Energy

Natural Gas Forecast 

Oil Forecast

2026's forecast is up 48 mbd to 284 mbd YOY on on Q2 actuals, but we do believe that the balance of risks  through the end of the year are to the upside.  We have not substantially changed our outlook for 2027 - the (73) mbd down is mostly from removing some odd patterns from this year that were carrying over to next.  Net/Net our total average production for 2027 is essentially constant at 14.2 mmbd.  We continue to believe that oil prices will remain elevated through 2027, well above Permian breakevens.  The major uncertainties in our forecast is are:  one, will Permian producers continue to exhibit restraint in the face of substantially larger returns (at least one has said no), and two, will this spill over to other, more-marginal basins?  We are leaning to no both, as our forecast shows.

As has been the case recently., virtually all of the growth continues to come from the Permian Basin, Now unconstrained by residual gas takeaway capacity. Most other basins remain flat to declining.

Appendix: Updated Alignment Dates

With the move to monthly cadence of Daily Production Model updates, we are no longer putting those updates in this note, but are retaining this section as a note of the "truth" baseline of our production estimates.

When fitting our daily production estimates, we consider two key dates for each subregion:

• State alignment cutoff: the date up to which we align our daily production estimates to state-reported production.  On this day and prior the daily production model monthly averages are guaranteed to match state data.
• Last fitted date (or "last good" date): the date up to which we regress against the state data. The last fitted date can sometimes extend beyond the state alignment cutoff — this occurs when we are modeling reporting delays and therefore fitting against our own version of the state data (as discussed here).

The current alignment dates by subregion are shown below: