EIA: Rapid declines in horizontal wells require more drilling to sustain oil and gas production

US crude oil and natural gas production has risen, but so have production declines from existing wells. As output from oil and natural gas wells decreases over time as reservoir pressure drops, operators must continue to bring new wells online to maintain or increase production, the US Energy Information Administration (EIA) noted in a recent analysis.

The increasing use of horizontal wells has played a significant role in this dynamic. While they produce more quickly after initial drilling, horizontal wells also decline more rapidly than vertical wells.

According to EIA, between 2010 and 2024, hydrocarbon production from new wells in the Lower 48 states (L48) generally offset and exceeded declining production from existing wells.

By December 2024, horizontal wells accounted for 94% of crude oil production and 92% of natural gas production in the L48. These wells enable rapid early recovery of hydrocarbons but experience steep production declines, increasing the need for continuous drilling to sustain overall output levels.

Oil production, well dynamics

In December 2023, L48 crude oil production averaged 11.0 million b/d. Production from wells that came online in 2023 or earlier fell to 6.7 million b/d in December 2024, a decline of 4.3 million b/d. Those declines were offset by the more than 15,000 new wells that were brought online in 2024—about 11,700 of which were horizontal wells. The new wells produced 4.4 million b/d of crude oil, enough to overcome declines from existing wells, bringing L48 crude oil production to 11.2 million b/d in December 2024.

Between December 2023 and December 2024, natural gas production from wells that came online in 2023 or earlier fell to 88.4 bcfd from 115.4 bcfd, a decline of 27.0 bcfd. New wells offset those declines, producing an average of 28.0 bcfd of natural gas in December 2024. L48 production for natural gas increased to 116.5 bcfd in December 2024.