Despite rising consumption and dwindling inventories, producers have been slow to restore output to pre-pandemic levels. Spending on exploration and production has remained near its lowest level since the start of the shale drilling boom. The number of rigs drilling in North America also reflects the pullback.
Fuel consumption is likely to rise into the summer driving season, and as air traffic picks up. Demand is also rising internationally as more economies reopen after Covid-19 restrictions. The International Energy Agency has said it expects global demand for oil in 2022 to exceed pre-Covid-19 levels.
Gasoline prices are up sharply and the cost of a barrel of crude could reach $100 this year. A look at the market forces driving those prices higher. https://t.co/SmLLqEqgOh
— WSJ Markets (@WSJmarkets) February 10, 2022