The EIA, of all things, taught me this week that 49% of all U.S. oil and condensate production now comes from the Permian Basin.

But the Permian you think of is vast, thousands of square miles with benches in it layered like a German chocolate cake, all full of oil and profitable as can be.

Nah.

Ninety percent of all Permian tight oil production comes from just 8 counties and little slivers of four more counties, two in the Midland and two in the Delaware. These areas have 58,000 wells stuffed into them already, many drilled on <600 foot spacing between wells that communicate with each other vertically and horizontally. There are actually only 3-4 productive benches (formations) in each of those cores and those primary benches generally make up more than 80% of total production.

The Permian currently produces about 6.1 MM BOPD. Every year that production declines by 2.4 MM BOPD, minimum. Over half the producing wells in these cores now produce less than 25 BOPD and 175 BWPD. The entire Basin makes 26 MM BPD of produced water.

I understand all this, I think, and if others did, they would be worried. Like I am. All of America's remaining oil eggs are in the Permian basket.