How do we migrate back to your oil Fundamentals under 90 a barrel what are The trigger points or catalysts that Break the ascent of oil So the catalysts really are very simple They're called supply and demand and We've got to get through the next few Weeks to see whether there actually is Going to be a driving season this summer Uh but underlying the The the differences of view is really What we think is raising prices down and We think of raising prices now are the Dislocations that have occurred as a Result of countries and companies Refusing to take on russian oil there's No easy substitute for euros we're not In a one oil pricing system two oil Pricing system and we have to remember That while wti may be at 120 or brent Maybe at 120 something Euros is trading at 30 percent lower Than that so it's it's not one clear Market and it's the disruption of that Lower price that we have to think about And ask why we have these higher prices And i'm going to just say that we're Planning a trip lisa john and i to abu Dhabi and of course we're going to have An oil summit there and we're going to Have on stage francisco blanche Christian malik of jp morgan blanche of Bank of america you and other worthies And the singular distinction seems to be
The guess That hydrocarbon investment will or will Not come on If we get higher oil prices are you more Optimistic than others that investment Will materialize Well i think we for starters i don't Think there's that problem i think we Have more than enough investment in Hydrocarbons i think we have a problem In the hydrocarbon world in that the United states the short cycle big guy Has lost a lot of oil production the us Was producing we have to remember 13 Million barrels a day in march of 2020. It went down to 10.2 million a day it's Now it's 11.9 million a day it's well Below where it was and where it would Have been had we not had that drop in Drilling we would have been at 14 and a Half million barrels a day and there Would not be this problem we have more Than enough spending Into oil and gas finding and development It shifted a little bit but if we look At the next two or three years and Compare expectations of demand and Supply we think the market is oversupply And have you seen any signs that demand Is starting to cool for driving for Flying that gives you confidence that Perhaps we might not see the driving Season that some people are expecting Well we actually just we're trying to
Observe that and we decided to look at Not only the four week average at this Time of year for uh national for gas Excuse me gasoline and diesel demand in The united states and we went back and Discovered at first glance that it was The lowest it's been in five years other Than in that That big year of 2020 when demand Collapsed completely we've now gone back 10 years to find a time when demand for Gasoline and diesel were as low as it is And we had to go back to 2012 2013. so If we think the eia weekly data have a Semblance of reality to it gasoline Demand is down year on year diesel Demand is down year and year and it's The lowest it's been for a decade and That's a sign that the price of oil has Had an impact on where demand is going And what still is the biggest oil Consuming country in the world so ed why Did you end up shifting your Expectations your forecasts higher if You still hold to that conviction that We might not see the driving season uh That a lot of people are saying we will Well we drove prices higher first of all To mark to market we had second quarter Results that are marking it to market Higher than what we where we were at and We try to figure out what was really Happening what was really happening was That companies and countries were for
Swearing russian crude they could find No substitute for it so they had to bid Up the availability of light sweet crude In the world that is not the same as Euros they bid it up from the country That has the most amount of this namely The us with our open borders And the fact of the matter is that u.s Exports have been booming our combined Exports of crude oil and petroleum Products in recent weeks have been at The 10 and a half million barrel a day Range that would make the u.s the Largest liquids provider in the world Bigger than russia bigger than saudi Arabia that's up By a couple of million barrels a day From where we were so when companies had To look away from russia for diesel Where did they go they went to the u.s When companies had to look for crude oil Where did they go they came to the u.s And our inventories came down giving a Misleading impression that the whole World was going down in the inventory Side the same way the u.s is just Quickly and i've only got a minute and This deserves a much longer conversation Of course how sustainable do you think That is politically because i don't Think those numbers are that well known Outside of conversations like this one Well i agree with you if the uh if it Became political people would start
Talking about stopping the exports just As they talked about stopping the Exports of natural gas but it could be Politicized in a way that it would be in An election year With gasoline prices being as important As they are
