(Bloomberg) -- Devon Energy Corp. expects to spend less next year to sustain oil and natural gas output as record oilfield inflation begins to abate.

Costs for drilling rigs and steel used to line the inside of oil wells have come down recently, Chief Executive Officer Rick Muncrief said during an interview with Bloomberg Television on Monday. Still, tight labor-market conditions remain an impediment to growth.

“We are addressing the labor in a very thoughtful, proactive way at these levels,” Muncrief said on the sidelines of the American Energy Security Summit in Oklahoma City. “Any increase in activity becomes somewhat problematic.”

After a 50% hike in oilfield costs since 2021, the Permian Basin of West Texas and New Mexico is expected to see average well costs shrink by 9% next year, according to a Citigroup note to investors last week.   

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