- “OPEC+ has been running the show for the last year, year and a half, but U.S. production is already coming back, and it’s going to come back even more in 2022,” said oil analyst Daniel Yergin.
- On Wednesday, he told reporters that output might grow to 900,000 barrels per day.
- Yergin also spoke on the security meetings between US and Russian officials on January 10th.
Forecast for U.S. Oil
According to Daniel Yergin, vice chairman of IHS Markit, after more than a year of OPEC and its allies “running the show,” U.S. oil output is back and set to surge in 2022.
On Wednesday, he told reporters that output may increase by as much as 900,000 barrels per day.
Oil companies in the United States cut output in 2020 as the coronavirus pandemic wiped off demand, and supply has yet to rebound to pre-COVID levels. According to the US Energy Information Administration, the US produced 12.29 million barrels of crude oil per day in 2019.
It was 11.28 million in 2020, and it is predicted to increase to 11.18 million in 2021 and 11.85 million in 2022.
“The United States is back,” Yergin declared. “OPEC+ has been running the show for the last year, year and a half, but U.S. production is already returning, and it will return even more in 2022.”
He also alleged that he was on two calls with the US energy secretary, during which the secretary recommended that firms increase production.
“Of course, that’s because the Biden administration is so worried about inflation and its political implications,” he explained.
Yergin also projected that oil prices will remain in the $65 to $85 per barrel range, with $100 oil unlikely “unless there is major global turbulence.”
On Thursday morning in Asia, international benchmark Brent crude prices were up 0.49 percent at $79.62, while U.S. crude futures were up 0.47 percent at $76.92.
Russia – U.S. Trade Relations
Yergin also spoke on the security meetings between US and Russian officials on January 10th.
Tensions have been high at the Russia-Ukraine border for weeks, and the deployment of Russian troops has frightened the US and its European allies.
On December 7, US President Joe Biden and Russian President Vladimir Putin held a video conversation. Putin demanded that Ukraine be barred from joining the North Atlantic Treaty Organization, but the US refused.
Although NATO is unlikely to allow Ukraine into the alliance, Yergin believes there is a need for “strategic ambiguity.”
You can’t have Vladimir Putin telling you that Ukraine will not join NATO, he continued.
The difficulty is how to come to the conclusion that “save[s] everybody’s face,” he explained.
Negotiations will be difficult, but “at least they’re talking,” Yergin added.