Oil and Gas Not a Fossil Just Yet

Between the recent commitment to supply LNG to the EU this year and oil prices appearing firmly rooted at over $100 per barrel, it’s easy to forget that the oil and gas industry rebounded strongly throughout 2021. Oil prices recently reached the highest levels in thirteen years. As oil prices continue to climb, so does the viability of many projects that have been sidelined since late 2014.??

These developments only become more attractive as markets and consumers begin to recognize that renewable energy cannot work as a standalone energy source in the US or abroad, as it can be intermittent when grid reliability is paramount. America looks to be doubling down on fossil fuels, hedging that global appetite is likely to continue to grow as we work toward a more diverse net-zero energy portfolio that cannot satisfy that demand alone.?

Though the US demand for fossil fuels is ultimately predicted to diminish over the long term, petrochemicals are rapidly becoming the largest driver of global oil demand. Petrochemicals are set to account for nearly half of the growth in oil demand up until 2050. This demand is driven by a wide range of applications, such as cell phones, electric vehicles, and lightweight plastic composites used to create durable, aerodynamic blades for wind turbines.?

America’s longstanding relationship with oil and gas isn’t going to end anytime soon. To exhibit this point, the Biden administration opened more than 80 million acres in the Gulf of Mexico to auction for oil and gas drilling, a record offshore lease sale that will ensure many years of continuous development in the US Gulf of Mexico.?

Next week, we’ll dive into carbon capture. If you haven’t already, ?LinkedIn?and?register for the conference here.