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US oil output remains subdued below pre-pandemic highs and, with energy prices well below a subsequent boom in 2022, investment in new North American capacity and infrastructure appears to be continually hobbled. That is not the case everywhere, however, as nations more reliant on China for energy demand continue to increase their investments in crude oil production, transport, and refining.

Related ETFs: SPDR S&P Oil & Gas Exploration & Production ETF (XOP), Energy Select Sector SPDR Fund (XLE), Invesco DB Oil Fund (DBO), VanEck Oil Services ETF (OIH)

As MRP noted earlier this month, the US Energy Information Administration’s (EIA) latest forecast calls for crude oil production to rise by 590,000 barrels per day (bpd) in 2023, and by another 160,000 barrels to an average of 12.65 million bpd by 2024, but it remains to be seen when new highs in production, which peaked at 13.1 million bpd in March 2020, will be achievable again. According to some in the industry, it’s possible it will never be seen again, based on recent trends in energy markets. Speaking to CNBC recently, Pioneer Natural Resources CEO Scott Sheffield said “We may get back to 13 million barrels a day,” but he noted that it will be at a “very slow pace,” taking two and half to three years to match that previous record level.

The US oil and gas industry was hollowed out by crashing energy prices in 2020, resulting in more than 100 bankruptcies in just that year alone. That destruction has proven difficult to recover from, continually hobbling American shale production, even during WTI benchmark crude oil’s subsequent surge to more than $120 per barrel in 2022. Since then, rising interest rates and deteriorating economic prospects have pushed crude futures back the toward $73.00 per barrel area, recovering slightly from a dip into the 60s last week. A count of active oil rigs tracked by Baker Hughes shows the North American tally now -28 rigs below its level at the end of last year. At this point, it’s unlikely we see any large surge in…

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