Record US Oil Production Outpaces Capital Spending

The largest US oil and gas producers have seen their capital expenditures drop by 49% year-over-year, despite reaching record production levels in 2025. This significant decrease is highlighted in EY's annual US Oil and Gas Reserves and Production Benchmarking Study, which covers the five largest publicly traded exploration and production companies.

The study shows that exploration spending fell 11% to $4.8 billion, accounting for only 3% of total capital expenditures across the group. Meanwhile, merger and acquisition (M&A) spending dropped by 70%, as the industry has moved past a wave of megadeals reshaping the sector.

Revenue still grew 7%, but pretax operating results fell 2% due to lower commodity realizations compressing margins, despite improved top-line performance. This discrepancy suggests that the extra revenue came from increased production rather than higher prices.