Why U.S. oil production isn’t growing even faster

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Data: EIA; Chart: Sara Wise/Axios

HOUSTON — One topic getting lots of attention at a huge energy industry conference here is whether U.S. oil production can grow even faster as western countries seek to isolate Vladimir Putin.

Driving the news: The U.S. Energy Information Administration just increased its 2023 U.S. production forecast to an average of 13 million barrels per day (mbd), up from 12.6 mbd in last month’s projection.

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  • But the latest outlook — stuffed with caveats because of, well, all this (waves hands) — has a far smaller upward revision for 2022.

Why it matters: Forces including supply chain and labor constraints and investor demands for returns are limiting growth velocity even at highly attractive prices, oil executives said at the CERAWeek by S&P Global conference.

What they’re saying: “You’re going to see the industry responding to this,” ConocoPhillips CEO Ryan Lance said.

  • “You’ll see the growth, you’ll see it coming out of this business, but people are going to have a hyper-focus on returns,” he said.

  • Lance also cautioned that “whatever we start doing today doesn’t get produced for 12 to 18 months from today.”

Occidental Petroleum CEO Vicki Hollub told the conference: “With supply chain challenges, it makes any kind of attempt to grow now — and at a rapid pace — very, very difficult.”

Go deeper: Oil prices surge as U.S. bans Russian energy imports

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