Lower upstream spending amid falling oil prices is set to slow the growth in oil supply from producers outside the OPEC+ pact this year and next, OPEC said in its monthly report on Wednesday.
Liquids supply from OPEC+’s rivals – including the United States – is set to increase by 800,000 barrels per day (bpd) in 2025, down by 100,000 bpd compared to OPEC’s assessment of 900,000-bpd growth last month.
In 2026, liquids supply from non-OPEC+ producers is expected to rise by another 800,000 bpd, also down by 100,000 bpd from last month’s assessment, OPEC said in its Monthly Oil Market Report (MOMR).
U.S. crude oil and condensate production is anticipated to expand by 130,000 bpd this year, and by just 44,000 bpd year-over-year in 2026, according to OPEC’s estimates.
The cartel expects capital spending on exploration and production in the non-OPEC+ producers to fall in 2025 and 2026, after small growth in 2024.
This year, upstream spending in producing countries outside the OPEC+ pact is set to drop by about 5% from last year, and by another 2% next year to around $277 billion.
In the U.S. in particular, upstream E&P liquids investment in 2024 is estimated to have dropped by 8% to about $125 billion. Investment is set to drop further, by around 9% and 7% in 2025 and 2026, respectively, according to OPEC.
“The potential impact on production levels in 2025 and 2026 of the decline in upstream E&P oil investments will constitute a challenge, despite the industry’s continued focus on efficiency and productivity improvements,” the cartel noted.
“Efficiency gains are expected to continue to increase on a well basis in the short term, through drilling longer laterals, more efficient operations, reduced downtime and flattening production decline curves.”
While expecting slower growth from rivals, OPEC left its global oil demand growth projections unchanged from last month, expecting 1.3 million bpd growth in both 2025 and 2026.
By Charles Kennedy for Oilprice.com
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