US Oil Production Nears New High in July 2026

U.S. oil production in July 2026 reached 13,948 thousand barrels per day (kb/d), just 47 kb/d short of the previous high recorded in October. The increase of 104 kb/d from June was driven primarily by gains in Texas (36 kb/d) and New Mexico (49 kb/d). However, production is expected to dip slightly in August to 13,881 kb/d before resuming a steady upward trend through August 2027, according to the September 2026 Short-Term Energy Outlook (STEO).

The forecast projects U.S. oil production to rise by 580 kb/d from August 2026 to December 2027, with December 2027 output expected to hit 14,461 kb/d. Onshore production in the Lower 48 states (L48) also saw a significant increase, rising by 95 kb/d in July to 11,484 kb/d, largely due to contributions from Texas and New Mexico. The STEO anticipates onshore L48 production to climb by 653 kb/d to 12,081 kb/d by December 2027.

Among the top 10 oil-producing states, Texas, New Mexico, and the Gulf of Mexico accounted for 82.6% of total U.S. production in July 2026. Texas, despite a year-over-year decline of 72 kb/d, maintained a production level around 5,768 kb/d. New Mexico, on the other hand, saw a year-over-year increase of 133 kb/d, with July production reaching 2,420 kb/d. Other notable states include Alaska, which saw a 64 kb/d year-over-year increase, and Wyoming, which hit a new high of 311 kb/d in July.

The Permian Basin, particularly Eddy County in New Mexico, is expected to contribute significantly to future production increases, with additional oil rigs potentially boosting output. The Gulf of Mexico also saw a 1 kb/d increase in July, although its production is projected to decline to 1,861 kb/d by December 2027. Overall, the data suggests that while some states may be nearing production plateaus, the U.S. oil industry is poised for continued growth in the near term.