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    Home > Chemicals Industry > Petrochemical News > Under the Biden administration's willingness to increase supply and reduce prices, the recovery of US crude oil production has been slow

    Under the Biden administration's willingness to increase supply and reduce prices, the recovery of US crude oil production has been slow

    • Last Update: 2022-10-19
    • Source: Internet
    • Author: User
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    On August 9, local time, White House spokeswoman Karin said at the White House briefing that the average price of gasoline in the United States has dropped below $4 per gallon, which is the fastest decline in gasoline prices in more than a decade, while the Biden administration will continue to seek to increase crude oil production
    .

    Biden famously completed a trip to the Middle East in mid-July, but his plan to persuade Saudi Arabia and OPEC to significantly increase production failed to materialize
    .
    At the same time, the Biden administration is also a new energy pursuer, and is not as enthusiastic about traditional crude oil as the previous administration, so will there be a significant increase in U.
    S.
    crude oil production in the context of the United States' desire to continue to control the retail price of gasoline?

    As can be seen from the chart above, although the Russian-Ukrainian conflict has pushed oil prices to a high level this year, there has been no significant increase in
    US crude oil production.
    At present, compared with the beginning of the year, the growth rate of US crude oil production is only 2.
    54%, the overall trend is relatively flat, and the profit stimulus brought by high oil prices does not seem to appear
    .
    Under the background of strong international oil prices, why is the US crude oil production slowly rising?

    Table 1 Comparison of changes in various indicators of shale oil drilling quantity in the United States

    U.
    S.
    crude oil output to shale oil as the main body, looking back at the past two years, May 2020 is the turning point, international crude oil prices since then began to enter a low rebound stage, from the above figure can also be seen, the number of shale oil completions in the United States is also from this moment began to bottom out, but the recovery rate is relatively slow, while the growth of the number of new drills is also less than expected
    .
    On the other hand, the total number of outstanding wells has experienced a sharp decline, which can be seen that the growth of the number of shale oil completions in the United States in the past two years is mainly based on the consumption of previously accumulated unfinished wells
    .

    If you look at the trend of the number of unfinished shale oil wells in the United States, it can be seen that from the beginning of 2014 to June 2020, the number of unfinished shale oil wells in the United States has shown an overall upward trend, with an increase of 97% and almost doubled
    .
    Even the era of low oil prices from mid-2014 to the spring of 2016 has not been able to stop the upward trend
    of unfinished wells.
    However, after July 2020, the number of outstanding wells in U.
    S.
    shale oil began to decline rapidly, and as of now, the decline has exceeded 50%, reflecting the decline
    of capital in the upstream exploration and production field.

    In summary, it can be seen that even in the context of the strong oil price exceeding 100 this year, the US crude oil production has not risen sharply, and there is still a big gap from
    the high of 13 million barrels per day before the arrival of the epidemic in 2020.
    At present, the willingness of the Biden administration to increase production and reduce prices is difficult both externally and internally
    .

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