WASHINGTON — U.S. rig counts in the Lower 48 remain well below recent highs even as oil and natural gas production reaches record output levels, according to new data released Nov. 17 by the U.S. Energy Information Administration (EIA).
EIA data shows the total monthly average of active crude oil and natural gas rigs peaked at 750 in December 2022 before declining to 517 in October 2025. Analysts attribute the trend to lower commodity prices, operational cost control and improved drilling and completion efficiencies. Oil-directed rigs fell 33% to 397 since the 2022 peak, while natural gas-directed rigs decreased 23% to 120.
Despite fewer rigs, production has continued to increase. Crude oil production in July 2025 reached a record monthly average of 11.4 million barrels per day in the Lower 48, and natural gas production set an all-time high of 117.2 billion cubic feet per day in August 2025.
The Permian Basin remains the nation’s top crude-producing region and the leading contributor to overall production growth. The region’s rig count has dropped 29% since December 2022, but output has increased 18% during the same period. Operators are targeting top-tier plays, extending lateral well lengths and adopting more efficient completion methods to maintain profitability despite reduced rig activity.
The Appalachia region, the largest source of U.S. natural gas, also recorded a 29% decline in rigs from 2022 levels. However, production rose 10% after stagnating in 2024 when natural gas prices remained low for an extended period.
EIA’s short-term outlook forecasts minor changes in 2026, including a 0.1 million barrel-per-day decrease in crude oil production and a slight increase in natural gas production. Analysts expect lower West Texas Intermediate prices and higher Henry Hub natural gas prices to influence drilling priorities next year.
Data cited in the report was provided by Baker Hughes Company and EIA’s Short-Term Energy Outlook.
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