Permian Basin Drives US Oil Rig Growth Amid Price Volatility
US oil drillers have added rigs despite price volatility in the energy market. According to the Baker Hughes rig count, the number of active drilling rigs in the US rose by 49 units compared to the same period last year.
The Permian Basin continues to be the epicenter of US oil growth, with an active rig count rising by 3 during the reporting period to reach 263 rigs. This represents approximately 45% of all US oil-directed drilling activity and a 7-rig increase from the same point in 2025.
Modern Permian wells are being drilled with lateral lengths frequently exceeding 15,000 feet, compared to the 5,000-7,000-foot laterals common during the 2014 shale boom. Infrastructure improvements have also reduced operational friction, allowing operators to extract more resource per surface location and per dollar of capital invested.
Despite a softening price environment, breakeven costs for most operators in the Permian Basin range from $40 to $55 per barrel, leaving a drilling margin between $23 and $38 per barrel. This has enabled sustained capital deployment even at current WTI prices.