Open figure viewer
Significance
Output will expand at a steady pace while oil prices remain at profitable levels. However, US policy towards the sector has to incorporate a major contradiction: encouragement in the short term, and possibly longer, while also designing policies to minimise fossil fuel consumption eventually in line with climate change mitigation targets.
Impacts
Growth in oil production, led by the Permian basin, will result in gas surpluses, creating a wide open arbitrage for US LNG exports.
The energy transition will hit petrol demand but other areas of oil product demand should remain relatively firm, particularly jet fuel.
Demand will provide US oil producers with profitable markets at home and abroad; over time, output growth will depend more on exports.
© Oxford Analytica 2023. All rights reserved. This content contains general information about geopolitical, macroeconomic and social developments or (where stated) other matters. It does not contain advice or recommendations that may be relied on. Where links to external websites are provided, this does not indicate that Oxford Analytica or Emerald agree with, endorse or have checked for accuracy the contents of said sites.
2023
You do not currently have access to this content.
