Rebecca F. Elliott
For all of the focus on an energy transition, the American oil industry is booming, extracting more crude than ever from the shale rock that runs beneath the ground in West Texas.
After years of losing money on horizontal drilling and hydraulic fracturing, the companies that have helped the United States become the leading global oil producer have turned a financial corner and are generating robust profits. The stocks of some oil and gas companies, such as Exxon Mobil and Diamondback Energy, are at or near record levels.
The industry’s revival after bruising losses during the Covid-19 pandemic is due largely to market forces, though Russia’s war in Ukraine has helped. U.S. oil prices have averaged around $80 a barrel since early 2021, compared with roughly $53 in the four years before that.
That the price and demand for oil have been so strong suggests that the shift to renewable energy and electric vehicles will take longer and be more bumpy than some climate activists and world leaders once hoped.
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