Oil prices have an impact on the U.S Economy, recently in the United States, domestic production has remained majorly flat. On the other side of the discussion, demand for oil has been on the increase. This has caused the price of the U.S oil benchmark WTI Crude to gradually increase.
But what does all this mean for the consultant in North America? Two points to note first:
As a Consultant in North America, you tend to benefit from rising WTI prices especially if the prices are sustained over a period of time. Higher prices would mean increased drilling activity. The exploration and production of U.S. shale deposits have been a strong source of job growth.
Hydraulically fractured wells that dominate a large percentage of US fields tend to have a shorter production life, so there is always new drilling activity to find the next deposit. All this activity requires labor including:
Lower oil prices mean less drilling and exploration activity because most of the new oil driving the economic activity is unconventional and has a higher cost per barrel than a conventional source of oil. Less drilling activity can lead to layoffs
On average, the discount between the European Brent and the U.S WTI is $4, but as the price of WTI rises, we see the WTI close that gap to under 2$.
GasBuddy data reported that the weekly U.S demand for gasoline rose for the fourth consecutive week (as is evident in the chart above). This brought the price to a new pandemic high being up almost 1% from the previous week.
On the refinery side of the discussion, the utilization rates of U.S refineries have seen a jump to 92.6% in the week leading up to June 11, the highest since the start of the Pandemic in 2020. This was higher than the 4-week average of about 89.9%.
Investigating U.S distillates and gasoline production revealed that those figures are also on the increase, with gasoline reaching highs of 9.9 million barrels per day (bpd) compared to 9.4 million bpd the previous week.
Some analysts hold the position that WTI prices could catch up with the Brent and have predicted that the result of the narrowing gap between the WTI and Brent could potentially drive US crude oil exports to lower values
On the 21st of June as at when this article was written WTI sold at a price of $71.7 and Brent Sold for a price of $73.5. This means the spread between WTI and Brent has closed in to a low value of $1.8.
What this means to you as a contractor: To our Manupers, the trends show increased activity in the Oil and Energy industry, especially in the US as more companies will be looking to fill positions for work. Thus, the timing to sign up on Manup cannot be more perfect. (https://www.getmanup.co/register/personnel)
Go ahead and create your Manup account and leave the rest to us as we intelligently & seamlessly connect you with projects matched to your unique requirements
About Fisayo Adeyemi
Fisayo works in Business Operations at Manup and has a strong interest in the oil and energy industry. His educational background is in Petroleum Engineering from Covenant University and Artificial Intelligence and Machine Learning: For Business Application from UTexas