A new report from the Federal Reserve Bank of Dallas highlights a turning point in the U.S. oil and gas sector. In its latest quarterly survey of more than 130 oil and gas executives, nearly half indicated plans to reduce drilling activity in 2025 (Axios, August 2025).

This shift in operator sentiment—driven by policy uncertainty, trade instability, and economic caution—has a direct impact on mineral rights and royalty owners across the country.

Why Drilling Is Expected to Decline

According to the Dallas Fed data, industry executives are increasingly cautious due to:

• Federal regulatory uncertainty

• Volatile global oil prices

• Capital constraints

• Uncertain trade dynamics

As reported by Axios, the energy sector is facing “rising pessimism,” with operators scaling back on exploration budgets and new drilling initiatives. This cooling trend can affect regions like the Permian Basin, Eagle Ford, and others where mineral development depends on consistent operator activity.

What This Means for Mineral and Royalty Owners

If you own mineral rights or receive royalty payments from producing or non-producing properties, these industry signals matter more than ever.

1. Reduced Royalty Growth

With fewer new wells being drilled, royalty income from undeveloped acreage may take longer to materialize—or may not reach projected levels at all.

2. Valuation Pressure

In slower markets, mineral assets tied to future drilling potential may see lower demand, which could affect your property’s market value if you’re considering a sale.

3. Longer Timelines for Development

If your acreage is currently undrilled or located in a marginal basin, this slowdown may mean a delay in leasing opportunities or production—especially as operators focus on higher-yield core zones.

Why Many Owners Are Reconsidering Their Strategy

In uncertain drilling environments, many mineral and royalty owners are reassessing how—and when—they should unlock value from their assets.

At Eagle River Advisors, we’ve seen an uptick in owners choosing to sell all or a portion of their interests to secure liquidity now, rather than wait through another unpredictable cycle. For some, the slowdown presents an opportunity to exit strategically, especially while commodity prices remain favorable in the short term.

Planning Ahead in a Shifting Market

While a reduction in drilling doesn’t mean production will stop, it can slow the pace of development—and your expected income. This makes it even more critical to understand your property’s current and future potential.

Our team at Eagle River Advisors offers transparent valuations, market-based analysis, and direct acquisition offers to help you make the best decision for your unique situation.

Need help evaluating your mineral or royalty interest?
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