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U.S. oil production not likely to top pre-pandemic levels—Occidental

March 05, 2021


Occidental CEO Vicki Hollub said Thursday that she doesn’t envision U.S. oil production returning to pre-pandemic highs.

“I do believe that most companies have committed to value growth, rather than production growth,” she said during a CNBC Evolve conversation with Brian Sullivan. “And so I do believe that that’s going to be part of the reason that oil production in the United States does not get back to 13 million barrels a day.”

She believes companies will focus on optimizing current operations and facilities, rather than seeking growth at all costs. But she added that oil demand is recovering faster-than-expected, driven primarily by China, India and the United States.

“The recovery looks more V-shaped than we had originally thought it would be,” she said. The company’s initial forecast had demand returning to pre-pandemic levels by the middle of 2022. Now, Hollub believes demand will return by the end of this year or the first few months of 2022.

Her comments came after West Texas International crude futures, the U.S. oil benchmark, jumped more than 4% on Thursday to trade as high as $64.86 per barrel, a level last seen in January 2020.

She expects crude prices will be “a little better than where they are today” if her demand forecast for next year is correct, but she does not expect prices to go up “excessively” other than the short spikes that can occur from time to time.

[Pippa Stevens]

More: U.S. oil production won’t return to pre-pandemic levels, says Occidental CEO

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