March 21

3/21 – After hitting 14-year highs of $123.70 per barrel on 3/8, WTI crude oil futures have retreated to $104.70 (3/18). AAA says the national average for gasoline dropped from $4.33 to $4.25 per gallon and should drift lower if oil stays near $100. Meanwhile, the political blame game rages on social media, so here are the facts in order of importance:

#1 OPEC is holding back output.

#2 Over 100 North American oil and gas companies declared bankruptcy when oil prices crashed in 2020, so many former shale producers are unable to “step up.”

#3 Americans hit the roads in the spring of 2021 and the snap-back in demand depleted fuel supplies more quickly than expected.

#4 Wall Street is on an ESG investment kick and fossil fuels are out.

#5 Politically, carbon reduction goals are discouraging investment in fossil fuel production and slower regulatory approvals are delaying new drilling.