With oil galloping closer to $100 a barrel, who’s going to come to the rescue?
Output from the Organization of the Petroleum Exporting Countries remains stuck around 5 million barrels a day below peak levels, constrained by weak production from Angola, Iran, Nigeria and Venezuela. Russian crude is still flowing, but it’s hostage to geopolitical tensions over Ukraine.
Meanwhile, U.S. shale producers are still perceived to be licking their wounds from 2020’s lurch into negative oil prices, focused on reassuring shareholders that there will be no repeat of the bonfire of capital they engaged in during the past decade. Take a look at the number of operating rigs out there, and you’d think the recovery had barely started: