- Top oil executives predict that increased domestic production will drive oil prices to a “low point” in 2026.
- The Permian Basin in Texas is at the heart of this surge, currently accounting for 40% of all U.S. oil production.
- This ramp-up is seen as a crucial step towards ensuring U.S. energy independence and national security.
- Despite the 2026 forecast, some experts warn of potential price shocks in the next 18 months as global demand could outpace supply.
Permian Basin Surge to Trigger 2026 Price Drop
Top executives in the American oil industry are forecasting a significant dip in oil prices by 2026, driven by a strategic push to increase domestic supply. The powerhouse behind this production ramp-up is the Permian Basin, a massive shale patch under Texas and New Mexico that has become the engine of America’s energy revival.
“We’re prepared for prices in ’26 to be lower than they were in ’25,” Chevron CEO Mike Wirth stated in an exclusive interview with FOX Business’ Maria Bartiromo. He explained that as this new wave of supply enters the market, it will rebalance supply and demand. “The market will come back into balance and I think we’ll see prices restored to a level a little bit higher, and ’26 may be a low point,” Wirth added.
A Resilient Hub of American Energy
The Permian Basin is currently the largest secure oil supply in the world, responsible for about 40% of total U.S. production. Projections indicate its share could skyrocket to 70% by 2040. This historic region has been a cornerstone of American energy for over a century.
“That’s why the Permian Basin is so amazing. It’s been producing for over 100 years and left for dead two or three times, and here we are now producing over 6 million barrels a day,” said Diamondback Energy CEO Kaes Van’t Hof. This output alone would make the Permian Basin the third-largest oil-producing country in the world.
Energy Independence and National Security
The push to increase domestic production is not just an economic strategy but also a matter of national security. By leveraging its vast natural resources, the United States can insulate itself from the influence of oil adversaries like Russia and Iran.
“Energy security and national security are linked,” Wirth emphasized. “The U.S. is blessed with an abundance of natural resources, and we now have an administration that wants to see the energy industry invest in those resources to make sure that America’s energy strength translates into economic strength and competitiveness and, importantly, security.”
A Warning of Future Volatility
While the outlook for 2026 points to lower prices, some industry leaders are sounding a note of caution for the more immediate future. Harold Hamm, founder of Continental Resources, warned that global oil demand could soon outstrip the available affordable supply.
“With about 18 months, that oversupply’s going to be gone. And then we need to watch out for some price shocks after that point,” Hamm warned. His comments highlight the delicate balance in the global energy market and underscore the importance of maintaining a robust domestic energy industry.
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