You may find it curious that the price of oil is still above $80 a barrel. This is also why gasoline prices are at the highest levels since 2014. But, there is a good explanation for it. In January 2020, just before the Covid-19 pandemic began to sweep across the U.S., domestic oil production was 12.8 million barrels per day (BPD). Production remained at that level for a couple of months despite the double-whammy of a price war between Saudi Arabia and Russia, and growing demand destruction as a result of the Covid-19 pandemic. But the situation was untenable. The price of oil eventually fell to zero and then kept going. That forced some producers into bankruptcy, resulting in the largest short-term oil production drop in U.S. history. U.S. monthly oil production since 2000 Production declined all the way to 9.7 million BPD in May 2020 (which was the […]