With the geopolitical risk factor firmly reinstalled into the market, oil prices have risen to four-year highs. Gasoline prices are up nearly 20% in the past year! This is noteworthy because U.S. oil (and gas) production has been soaring to record heights. Thanks to the fact that “U.S. crude oil production efficiency continues to improve,” breakeven costs are now “as little as $25 per barrel.” In fact, higher U.S. crude production is the key source of global supply that can offset potential supply losses elsewhere. And more drilling activity increases the chances for even more output moving forward. Since the start of the year, the oil rig count has risen 11% to 825, the highest since March 2015.
