U.S. oil production hit levels not seen since the onset of the COVID-19 pandemic, a development driven by a continuing rebound in demand for gasoline and other fuels.
Daily crude oil production averaged 12.3 million barrels per day during the week ending Friday. The last time field production was that high was April 2020.
BIDEN’S COMMENTS ON NEEDING OIL AND GAS FOR ‘A WHILE’
The sector has been gradually increasing output over the last year and a half as the economy recovers from the worst of the pandemic.
Production began tanking in spring 2020 as COVID-19 spread and lockdown policies ensued, destroying demand for gasoline and other transportation fuels. Benchmark oil prices briefly went negative, and output eventually fell to a low of 9.7 million barrels in February 2021.
Production has recovered but remains below its peak above 13 million barrels per day that was sustained during the first few months of 2020, according to the Energy Information Administration.
Production levels have been a big political issue over the last year since Russia invaded Ukraine, which spiked oil prices to a high of about $130 per barrel.
Oil traded above $100 per barrel for much of the first half of 2022, leading President Joe Biden to implore oil companies to bring more barrels to market to reduce high retail gasoline prices.
Gas prices hit a new nominal record in June 2022 before falling alongside falling oil prices.
Biden repeated his criticisms against major oil companies during his State of the Union address Tuesday night, accusing them of doing too little to increase production and padding their profits by buying back their own stock.
Major oil companies, including Exxon Mobil, Chevron, and Shell, earned more money in 2022 than ever before, causing some Democrats in Congress to push again for a windfall tax on their profits.
The corporations have rebutted critics and pointed to plans to increase production. Chevron posted record annual oil and gas production in the U.S. for 2022.
Executives have also demanded the Biden administration back away from policies designed to restrict or penalize production, including production on federal lands, and said the industry needs more signals from the government that its products will be in demand to expand more quickly.
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Biden said on Tuesday the U.S. will need oil and gas for “a while” even as he tries to speed up a transition away from fossil fuels.
