The relationship between big oil and big corn has been tenuous at best for years, but with historic declines in fuel consumption due to COVID-19, the fight has reignited in a major way. Oil refiners and their allies from the Gulf Coast and Pennsylvania are in a serious policy battle with ethanol producers, corn farmers and Midwest politicians. At the heart of the disagreement is that the oil refining industry is seeking waivers from biofuel blending requirements resulting from the Renewable Fuel Standard (RFS).
Chevron and ExxonMobil highlighted an aggressive strategy for drilling in the Permian Basin over the next five years to their investors this week. Exxon is aiming to increase production to 1 million barrels per day while Chevron is targeting an additional 900,000 barrels per day, all by the end of 2024. The presentations from both companies exemplify a growing trend in the region that has made the United States the world’s top producer of oil and natural gas.
WTI oil prices rose Monday morning to $56.94/barrel due to a barrage of bullish headlines which puts this year’s oil rally north of 22% and climbing.
After a few days of deliberation, OPEC + has finally decided to cut 1.2 million barrels per day of oil production.
Wood Mackenzie (WoodMac), a global energy, chemicals, renewables, metals and mining researching and consulting firm, states companies need to raise investment into new production by 20%. Oil and gas companies need to increase annual investment before a supply demand in 2025. The investment could reach about $600 billion to ensure companies sustain production and growth for impending demand.