Finance
Higher oil prices will not spur more US production, oilfield services company Patterson-UTI says
Published by Global Banking & Finance Review®
Posted on March 10, 2026
2 min readLast updated: March 10, 2026
Quick Summary
Patterson‑UTI CEO Andy Hendricks warns that even amid a spike in oil prices—from as high as $119 to a sharp drop to $83—U.S. producers won’t ramp up output without stable long-term price forecasts, since bringing new wells online can take over six months; U.S. production remains near record highs at
Patterson-UTI: Rising Oil Prices Won't Spur More US Output Without Market Stability
Market Volatility and Its Impact on U.S. Oil Production
By Georgina McCartney
Energy Prices Surge Amid Geopolitical Tensions
HOUSTON, March 10 (Reuters) - A surge in energy prices caused by the U.S.-Israel war with Iran will not lead to additional U.S. oil output without the market predictability needed to ensure more drilling, Andy Hendricks, CEO of oilfield services company Patterson-UTI, said on Tuesday.
Wild Swings in Oil Prices
Oil prices have swung wildly since the end of February after Iran shut the Strait of Hormuz, a key trade route, forcing major producers in the Middle East to cut production. U.S. crude futures hit $119 a barrel at the start of this week, the highest level since August 2022, and moved within a $35.80 range during Monday's trading session.
On Tuesday, they settled at $83.45 a barrel, down $11.32, as U.S. President Donald Trump predicted de-escalation. [O/R]
Industry Response and Production Challenges
Budgeting and Planning Amid Uncertainty
"The challenge is in December, when we and the oil and gas companies we work for were all working on our budgets, oil was in the $50s," he said in an interview, adding that it can take more than half a year to bring wells online.
"What is the true price of oil going to be in six to nine months?" he asked.
Current Production Levels
U.S. oil production is already near record levels, hitting 13.7 million barrels per day last month, according to the U.S. Energy Information Administration. Permian production was at 6.59 million bpd, down from a record 6.74 million bpd hit last year.
Future Outlook for U.S. Oil Output
Dependence on Geopolitical Stability
Hendricks said the trajectory of U.S. oil production would depend largely on how long it takes the situation in Iran to normalize and trade to resume through the Strait of Hormuz.
Potential Slowdown in Permian Production
"I think the risk is that Permian oil production starts to slow this year. If it does slow this year that will probably cause prices to move up and then that will cause the industry to start to pick up activity," he said.
(Reporting by Georgina McCartney in Houston; Writing by Liz Hampton in Denver; Editing by Bill Berkrot)
Key Takeaways
- •Oil prices soared to around $119 per barrel amid the U.S.–Israel war with Iran and closure risks at the Strait of Hormuz, before falling to about $83 as de‑escalation signs emerged (moneycontrol.com).
- •Patterson‑UTI CEO Andy Hendricks cautioned that price volatility and unpredictability make it difficult for U.S. operators to commit to new drilling, noting it can take six to nine months to bring wells online (moneycontrol.com).
- •U.S. crude oil production remains near record highs—around 13.6 million barrels per day—with the Permian Basin contributing roughly half, though production growth is expected to slow in 2026 amid lower prices (ogj.com).
References
Frequently Asked Questions about Higher oil prices will not spur more US production, oilfield services company Patterson-UTI says
1Will higher oil prices lead to increased US oil production?
According to Patterson-UTI's CEO, higher prices alone will not spur more US oil output without market predictability.
2What is causing the recent volatility in oil prices?
Oil prices have swung due to the US-Israel conflict with Iran and the closure of the Strait of Hormuz.
3How long does it take to bring new oil wells online?
It can take more than half a year to bring new wells online, according to Patterson-UTI's CEO.
4What could slow Permian oil production this year?
Permian output may slow due to current geopolitical uncertainty and trade disruptions through the Strait of Hormuz.
5How has US oil production trended recently?
US oil production is near record levels, at 13.7 million barrels per day, but some regions like the Permian have seen recent declines.
