US on brink of energy crisis as shale oil collapse begins
According to webangah News Agency, American oil firms are scaling back operations amid rising costs from Trump-era tariffs and declining crude prices that threaten profitability.
Industry executives warn this marks the end of a decade-long shale boom, with OPEC+’s unexpected production increases deepening pessimism across the U.S. oil sector.Analysts fear a renewed price war could emerge, forcing downward revisions to output forecasts.
“We’re now in full contingency mode,” Devon Energy CEO Rick Muncrief told investors in Oklahoma City.”When conditions deteriorate further, all options are on the table.”
S&P Global data projects U.S. oil output will drop 1.1% next year to 13.3 million barrels per day – the first annual decline since 2020’s pandemic-driven crash when prices briefly turned negative, triggering bankruptcies across Texas and North Dakota.
Benchmark U.S. crude fell again Friday,closing at $61.53 per barrel – roughly 23% below this year’s peak – as shale producers struggle with breakeven points above $65 according to the Dallas Fed’s quarterly survey.
“The mantra now is survival,” said SM Energy CEO Herb Vogel during remarks in Denver.
The production slump concludes a transformative chapter in U.S energy history where the shale revolution unleashed unprecedented volumes of affordable oil and gas, boosting GDP growth, employment records, and export volumes that improved America’s trade balance.
While former President Trump vowed to support drilling for “energy dominance,” output levels that peaked under President Joe Biden may decline further if prices continue sliding.
