Home Economy Crude oil prices show strength as economy recovers

Crude oil prices show strength as economy recovers


The price of crude oil has made back all that it lost during the COVID-19 pandemic of 2020 as demand for petroleum products has returned.

In January 2020, crude oil traded in the $60 range for West Texas Intermediate on the New York Mercantile Exchange (NYMEX), but began to slide as the global economy went into a tailspin because of governments’ worldwide ordered lockdowns. 

By the beginning of the second quarter the WTI price had fallen to less than $20.

Soft prices resulted in production declines in the U.S. and around the world. U.S. production dropped from 13 million barrels per day (b/d) to 11 million b/d.

The Organization of Petroleum Exporting Countries and a group of non-member producing countries, which includes Russia, decided to cut production by 9.7 million b/d.

As supply decreased and demand increased the oversupply eventually eased. Crude oil inventories in the U.S. reached a record high of 540 million barrels in June 2020, but they have…

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