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…