RS, interesting US chart...would be curious to see it with a line plotted for demand. Production dropped off since demand went down during the lockdown...
Production dropped off ... after
the alligators came.
That was a worldwide phenomena ... not just in the US, as the charts I posted clearly showed.
Big part of that was less demand ... but another part of it was
storage, as in
lack of ...
How the COVID-19 Pandemic Plunged Global Oil Prices
Remember when oil prices actually went
negative ?
U.S. could face crude oil storage problem, recovery from COVID-19 could bring respite
Another (secondary, tertiary ?) driver of it was when oil prices fell, rigs were shut down ... largely due to economics.
A grand total of 50 energy companies filed for bankruptcy during the first nine months of 2020, including 33 oil and gas producers, 15 oilfield services companies and two midstream companies.
There was fallout in the oil industry with smaller producers, particularly in the shale oil sector - which itself appears to have been an unprofitable venture overall. Hard to attract investors when there isn't a return.
The U.S. Shale Revolution Has Surrendered to Reality
I wonder if US production has returned enough to keep up with demand. I went to that website but didn't see that as an option.
Well, we aren't seeing "shortages" to the extent that there is rationing and lines at gas stations so I'd say it's a safe bet that the demand is largely being met from
somewhere ...
Oil imports expected to rise in 2021 (and they did) and in 2022 ... in order to meet demand.
Another aspect of all this that pertains to retail pricing is the role that OPEC plays ... they're big producers and several of their large producers basically control the "spare capacity" valve ... it's obviously in their interest to see higher prices ... provided that it doesn't excessively constrain demand.
Middle Eastern Oil Nations Hike Prices As Production Falters
OTOH, OPEC Plus probably saved a good bit of the oil industry - by agreeing to slash their production during the alligators.
In July '21 OPEC plus promised to up production by an additional 400,000 barrels a day. For the past several months they have achieved about
half that. That just might say something ...
Beyond that, refiners' margins play some role as well ... as they seek to recoup losses caused by those pesky alligators.
Long story short:
There's undoubtedly more to it, but it's a complex situation with many inter-related parts which have the ability to influence other parts ... and probably there is no "magic wand" that is going to fix it overnight.