US EIA oil production and rig count trends

Research evidence excerpt

US EIA oil production and rig count trends

RBC Dominion Securities Inc.

Keith Mackey, CFA (Analyst)

(403) 299-6958,

keith.mackey@rbccm.com

Kate Ross, CPA (Associate)

(403) 299-6952,

kate.ross@rbccm.com

July 1, 2026

US EIA oil production and rig count trendsRESEARCH Producing the same with less does not equal producing more with less

Our view: In recent years, US oil production has grown while rig counts have decreased, leading investors

to generally believe US operators are unilaterally doing more with less. On a collective basis, this appears

to be the case, but the true answer is more nuanced, and region-specific. Alongside this month's EIA

oil production release, we assess the largest-producing US regions of Offshore, Texas, and New Mexico,

alongside with their corresponding rig counts. The 468Mbbl/d production increase over the past year

was essentially concentrated in two regions, as shown below. Offshore and New Mexico produced more

on a y/y basis with more rigs, while Texas produced approximately the same amount of oil with fewerEQUITY

rigs. Inventory quality, individual well recovery, surface efficiency (rig and frac crew), and infrastructure

are key considerations of forward oilfield service demand and will feature in future iterations of this

note. For now, we are happy to challenge the 'more with less' paradigm associated with the service

sector.

US oil production hit 13.9MMbbl/d, growing 468Mbbl/d (3.5%) y/y. US oil production reached

13.9MMbbl/d in April, increasing by 216Mbbl/d (1.6%) m/m, driven by growth in Offshore and New

Mexico, while modest Texas growth offset declines from the other 48 states. Our four main observations

from this month's update are:

1. The majority of US oil production growth was driven by offshore Gulf of America. Offshore oil