Industry leaders claim that despite volatility, US Gulf oil production could reach 2.4 millions bpd.
Leaders in the oil and gas sector said that the U.S. Gulf of Mexico could continue to grow oil production despite geopolitical instability not seen for decades.
Since last month, U.S. President Donald Trump’s global tariff announcements contributed to a drop in oil prices, and fears of a recession, making it harder for oil producers who follow his "drill baby, drill" call.
"We have never experienced such geopolitical instability," said Occidental Petroleum's CEO Vicki Hollub during a Monday panel discussion at Offshore Technology Conference.
Oil leaders are confident that the Trump administration will remove any obstacles to increase production despite the fluctuating oil prices, which experts say come mostly from the shale sector and not offshore.
According to Erik Milito of the U.S. National Ocean Industries Association, oil production in the U.S. Gulf may reach 2.4 million barrels a day (bpd) from its current level of 1.8 million bpd.
Executives said that technological advances, such as artificial intelligence, also help production.
Milito stated that "we're seeing it today with the highly sophisticated projects coming online. These projects are overcoming many of the challenges we faced 20 years ago."
The Trump Administration plans to hold a
Lease sale
Former President Joe Biden's administration had planned to visit the U.S. Gulf Coast in June.
Hollub explained that this will be crucial because the shale production will plateau and then begin to decline. It is therefore important to increase offshore exploration.
She said, "We need to find ways to extract more from the Gulf of Mexico and we have to do it in a big manner."
About 15% of the total U.S. crude oil production comes from offshore production in the U.S. Gulf.
Industry leaders cite inflation as a challenge to the sector, in addition to geopolitical uncertainties.
Magda Chambriard is the CEO of Brazil's oil state company Petrobras. She said, "We challenge our local suppliers as well as our international suppliers...on cost."
(source: Reuters)
