U.S. energy leaders predict a strong rise in offshore oil production if a second Trump administration takes office. They credit this to faster permitting, steady investments, and new technologies. The Gulf of Mexico’s output could increase from 1.8 million barrels per day (bpd) to 2.4 million bpd by 2027, according to the U.S. Energy Information Administration (EIA) and the Bureau of Ocean Energy Management (BOEM).
While shale oil offers flexibility, its growth is expected to slow down. As a result, companies are shifting more focus to offshore drilling. The Trump administration’s push to speed up approvals for oil and gas projects on federal lands is expected to support this growth.
BOEM manages 2,227 active leases on the U.S. Outer Continental Shelf (OCS). As of 2024, 469 of these leases are producing oil or gas. In 2023, leases on the OCS generated over $7 billion in federal revenue and accounted for about 14% of total U.S. crude production.
Recent BOEM studies estimate the Gulf holds nearly 30 billion barrels of oil and 54.8 trillion cubic feet of natural gas in technically recoverable, undiscovered fields. A 2023 update added 1.3 billion barrels of oil equivalent, a 22.6% increase, after analyzing more than 37,000 reservoirs across 1,336 fields.
Technology is also helping deepwater drilling advance. Chevron’s Anchor project recently began production at record pressure levels of 20,000 psi, marking a first in the industry and a major engineering milestone.
Energy companies are also using artificial intelligence (AI) to reduce risks and improve operations. Firms like BP and Devon Energy apply AI for predictive modeling, real-time drilling, reservoir analysis, and cost forecasting. This helps them stay competitive in a volatile market.
Despite the promise of offshore growth, challenges remain onshore. The U.S. oil and gas rig count has dropped to its lowest since November 2021. In the Permian Basin, rig activity is down 11% year-over-year, with fracking activity also falling. Many operators are adjusting strategies as a result.
Diamondback Energy recently cut its 2025 capital budget by $400 million, now planning to spend $3.4 to $3.8 billion. It will reduce rigs by three and cut one full-time completion crew. Its production forecast for 2025 dropped to 857,000–900,000 barrels of oil equivalent per day, down from earlier guidance.
ConocoPhillips and others are also cutting spending and scaling back completions, citing low prices and narrow profit margins.
Global market factors could complicate the U.S. supply outlook. OPEC+ is considering a 411,000 bpd production increase in July. Saudi Arabia supports the move, aiming to offset repeated quota breaches by members like Kazakhstan. If demand doesn’t rise accordingly, this could push prices lower.
Still, offshore production could help fill gaps left by slower shale growth. In 2024, federal offshore areas produced 668 million barrels of oil and 700 billion cubic feet of natural gas. These numbers are expected to rise as new projects begin and lease activity grows.
Analysts say U.S. offshore oil remains competitive globally despite trade tensions and policy changes. Its steady, high-volume production provides reliability that investors and buyers value. Even with Chinese tariffs on U.S. LNG, American energy exports are still growing.
The future of U.S. oil production—onshore and offshore—will depend on market prices, regulations, and geopolitical risks. But for now, the Gulf of Mexico sends a clear message: offshore oil is no longer a secondary player. It is the center of the next phase of U.S. oil growth.
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