Dallas Fed Survey: Permian Basin Executives Expect Modest U.S. Oil Production Increases in 2026 Despite Iran War

U.S. Permian Basin predict only modest increases in domestic oil production this year in response to the Iran war, according to a Dallas Fed survey. U.S. oil output for the current year, while 43% anticipated an uptick of 1 to 250,000 barrels per day.

Seventeen percent expected a rise of 250,000 to 500,000 barrels per day, and just 1% predicted more than 1 million barrels per day additional output. The survey, conducted by the Dallas Fed and covering executives in the prolific Permian Basin, showed a slightly more optimistic view for 2027.

U.S. Oil production that year, 26% expected an increase of 1 to 250,000 barrels per day, and 32% predicted a boost of 250,000 to 500,000 barrels per day.

West Texas Intermediate futures climbed from $57 a barrel at the start of the year to $111 at the height of the Iran war, settling just below $100 during the past week. The Strait of Hormuz, through which one-fifth of the world's oil and liquefied natural gas passed before the war, has been largely closed off for more than 40 days.

A separate Dallas Fed survey last month found half of exploration and production executives reporting no change in the number of wells their firms expect to drill in 2026.

Twenty-six percent noted only a slight increase in planned drilling for the year. com reported that pre-war oil shipments via tankers from the Persian Gulf have only now reached their destinations, exacerbating supply disruptions. Anonymous respondents in the latest Dallas Fed report highlighted uncertainty dampening production plans.

' The same respondent continued, 'Our hypothesis is [that] the paper market is being manipulated. ' Another anonymous oil chief criticized the administration's approach, stating, 'The administration’s comment about an ‘Iran terror premium’ existing for decades with crude oil pricing is laughable.

com reported that executives appeared to reference President Donald Trump's use of social media to influence energy prices.

Paul Sankey, president of Sankey Research, told Bloomberg TV on Thursday that inventory numbers have started to get scary as countries tap their reserves. He warned that the next two months would be an ongoing, absolute disaster even if the Strait of Hormuz opens tomorrow, because tankers are all in the wrong places.

Sankey noted the Strait's closure has halted fresh inflows of Middle East oil, making shortages unavoidable.

Analysts at JPMorgan stated in a note Tuesday that commercial inventories in OECD countries will hit operational minimums sometime between May 9 and May 30. They estimated that reviving oil production will take four months to reach 99% of capacity after the war ends.

Ports will take two months to reopen, and tanker crews will wait two to three weeks to feel safe enough to travel through the Strait of Hormuz again.