Texas Border Business
AUSTIN, Texas – The Texas Independent Producers and Royalty Owners Association (TIPRO) released the 11th edition of its “State of Energy Report,” offering a detailed analysis of national and state trends in oil and natural gas employment, wages and other key economic factors for the energy industry in 2025. TIPRO’s “State of Energy Report” series was developed to quantify and track the economic impact of the domestic oil and natural gas sector with an emphasis on the state of Texas.
According to TIPRO, the industry supported 2,043,859 direct jobs in the U.S. last year, with total direct and indirect jobs tied to the industry reaching more than 19 million. The U.S. oil and natural gas sector paid a national annual wage averaging $84,574 and had a combined payroll of $173 billion. Total U.S. goods and services purchased in 2025 by the oil and natural gas industry reached $722 billion from over 900 business sectors, notes TIPRO. Direct Gross Regional Product (GRP) also exceeded $1 trillion last year.
In Texas, the oil and gas industry once again led the nation in industry employment last year, accounting for 23 percent of all oil and gas jobs in the nation, as outlined in the association’s new report. The industry supported a total of 476,777 direct jobs in Texas in 2025, with total direct and indirect employment of 2.5 million. Total U.S. goods and services purchased by the Texas oil and natural gas industry reached $263 billion last year, 81 percent of which came from Texas businesses, benefiting virtually every business sector in the state. Direct GRP equaled $385 billion in 2025, supporting 36 percent of the state economy.
The Lone Star State again was the nation’s top oil producer, supplying nearly 2.1 billion barrels of oil to energy markets in 2025, setting a new record. TIPRO reports that Texas also broke a new record in natural gas output last year with over 13.5 trillion cubic feet of gas produced. U.S. crude oil production averaged a record 13.6 million barrels per day in 2025. Further, U.S. natural gas production in 2025 averaged a record 107.7 billion cubic feet per day.
“Despite facing a number of unique challenges, the U.S. oil and gas industry continued to offer significant economic support in 2025, while providing reliable and affordable energy to meet growing domestic and global demand,” said Ed Longanecker, president of TIPRO. “Thanks to record production, driven significantly by the Permian’s improved well-productivity, domestic demand was met and natural gas continued to supply affordable and reliable power. We applaud the Texas oil and natural gas industry and the policymakers that understand its importance,” added Longanecker.
Geopolitical tensions around the world continued to be a prevalent issue with conflicts in the Middle East and Ukraine fostering uncertainty and volatility across global energy markets. In 2025, Europe accounted for approximately 50 percent of total U.S. liquified natural gas exports, while 38 percent of U.S. LNG went to Asia and 12 percent was sent to Latin America and other regions. Overall, U.S. LNG exports for the year reached 89.1 million metric tons, a slight increase from 88.3 million metric tons in 2024.
American LNG, driven in large part by Texas natural gas production, continues to be an essential resource for our allies, as nations work to meet heightened energy demand while shifting away from their dependence on Russian energy supplies. In 2026, LNG exports are expected to average 14.5 billion cubic feet per day, an increase from the previous year. With President Trump’s reversal of the Biden Administration’s pause on permits for LNG export terminals, the U.S. oil and gas industry can resume its role as a reliable trade partner to our nation’s allies. TIPRO remains optimistic about the Trump-Vance Administration and the continued support of U.S. energy. The growth of domestic natural gas markets is closely reflected in increased U.S. LNG exports as well. The capacity to export LNG competitively on the global markets hinges upon the ability to maintain and grow production of natural gas domestically.
“TIPRO will continue to advocate for policies at all levels of government to strengthen the U.S. oil and natural gas industry, ensuring Texas remains the nation’s leading producer while supporting jobs, economic growth, energy security, and reliable, affordable energy for consumers and industry,” said Longanecker.
A core priority is comprehensive permitting reform. TIPRO supports streamlining and expediting federal, state, and local permitting processes for exploration, production, infrastructure, pipelines, and LNG export facilities. Current delays, overlapping reviews, and lengthy timelines increase costs, discourage investment, and hinder timely development. TIPRO encourages decisive action to establish clear deadlines, eliminate unnecessary redundancy, and provide regulatory certainty for operators while preserving strong safety and environmental protections.
Additionally, Texas is experiencing a significant increase in electricity demand due to a surge in population and emerging industries such as data centers and artificial intelligence. By 2030, ERCOT anticipates that peak load could reach about 152 GW, almost doubling its historic record, posing both challenges and opportunities for the grid’s future stability and growth. Experts predict that ERCOT will continue to rely on natural gas’ share of electricity generation for load growth, accounting for approximately 30.3 percent of the grid’s total generation in 2025 and 33.9 percent of generation by 2030.
Given the U.S. power sector’s sustained reliance on natural gas for electricity generation, the occurrence of occasional severe weather events that require dispatchable generation, and the electrification of our economy, natural gas is set to remain a critical energy resource for the power sector in the coming year, reinforced TIPRO.
What does Oil & Gas mean for Texas?
- Texas led the nation in oil and gas jobs with 476,777 people employed in this industry. 23 percent of all oil and gas jobs nationwide were located in Texas last year.
- When incorporating direct, indirect, and induced multipliers for oil and gas employment, the industry supported a total of 2,509,121 jobs in Texas last year.
- Texas was the leading state by employment in 16 out of the 19 sectors used to define the oil and natural gas industry in 2025.
- Oil and gas jobs in Texas paid an annual average wage of $133,439, 74 percent more than all average private sector jobs in the state. The highest average industry wages were in Alaska last year ($150,986). Iowa had the lowest average oil and gas wages in the country ($36,192).
- Texas had the highest oil and gas payroll in the country in 2025 ($64 billion), with California coming in at a distant second ($15 billion), followed by Louisiana ($10 billion).
- Texas had the highest number of oil and gas businesses in the nation last year with 23,483, followed by California (9,593), Florida (7,728), Georgia (6,494) and Pennsylvania (5,737).
- Oil production in Texas reached a new record of nearly 2.1 billion barrels in 2025. New Mexico had the second highest oil production with 797 million barrels, followed by North Dakota with 426 million barrels produced, subject to revisions.
- Texas led the country in natural gas production with a record 13.5 Tcf produced in 2025, followed by Pennsylvania with 7.8 Tcf.
- Texas had the highest rig count in the country in 2025 with an average of 272 active rigs. The number of rigs in Texas decreased from 277 in January to 253 in December. New Mexico had the second highest average rig count (98) in the country last year.
- In 2025, direct Gross Regional Product for the Texas oil and natural gas industry was $385 billion. Using the typical multiplier effect of 2.5, the Texas oil and natural gas industry supported 36 percent of the Texas economy.
- The Texas oil and natural gas industry purchased U.S. goods and services in the amount of $263 billion, 81 percent of which came from Texas businesses.
- The Texas oil and natural gas industry paid a record $27 billion in state and local taxes and state royalties in Fiscal Year 2025.
- Texas oil and natural gas operators paid over $8 billion in severance taxes in 2025.
The “State of Energy Report” series is published exclusively by TIPRO. A full list of the data sources used to develop this analysis can be viewed in the methodology section of the report.
Visit https://tipro.org/2026-state-of-energy/ to view TIPRO’s new “State of Energy Report.”
Information source: TEXAS INDEPENDENT PRODUCERS AND ROYALTY OWNERS ASSOCIATION
