At $50 per barrel, oil and gas companies curtailed drilling and cut costs. Production fell. In 2015, U.S. output hit its highest level in 100 years. Oil prices sank below $40. Then on January 20, 2016, prices slid to $27 per barrel. In 2017, prices are bouncing around between $45-$50 per barrel. Supply is outpacing demand. Storage of crude oil in the U.S. is at record highs. And U.S. exploration and production companies continue to drill and complete wells… adding to bloated supplies and keeping prices low. As of July 2017, there are 6,000 wells that have been drilled and are awaiting completion onshore in the U.S. The world is in a “second industrial revolution.” As less developed countries like China and India emerge from agrarian economies to modern industrial societies, billions of people will require energy and oil to fuel their development. As in early 20th century America, transportation will be a major driver of this need for oil. In the U.S., there are 750 cars per every 1,000 people. With a population of 324 million people, that’s about 244 million cars burning fuel refined from crude oil. In China, there 22.5 cars per every 1,000 people today. With a population of 1.6 billion, that’s about 36 million cars. What happens when there are 100 cars per 1,000 people? 200 cars per 1,000 people? Ok, what happens with there are 750 cars per 1,000 people in China?With 1.6 billion people, that’s 1.2 billion cars . That’s an enormous demand for oil. In India, there are eight cars per thousand people in 2017. India has 1.25 billion people. What happens when India has 750 cars per thousand people. That’s 937.5 million cars . Within the next 15 years, we could see another 2.1 billion additional But another boom is coming. The biggest oil boom in history.
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