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US oil sector readies oil production increases

Executives at some of the world’s top producers of hydrocarbons have pledged to increase their crude oil production, although they warned that this could not be achieved overnight.

The US, the UK and the EU have all announced plans to reduce or ban the importation of Russian oil and gas. Prior to the announcement, Jen Psaki, the White House’s Press Secretary, had said that internal discussions about a ban on Russian oil were still ongoing, as well as talks:

“With our counterparts and partners in Europe and around the world. What the president is most focused on is ensuring we are continuing to take steps to deliver punishing economic consequences on Putin while taking all action necessary to limit the impact to prices at the gas pump.”

The bans by some of the world’s biggest oil consumers now create a challenge for finding alternative sources of crude oil. Chevron and ExxonMobil, the oil majors behind the Texaco and Mobil lubricant brands, already indicated plans to increase their US shale production, but these plans have now acquired a new impetus. Hess Corp. CEO John Hess also said his company was spending more on new wells, especially in North Dakota’s Bakken field.

The US Government is also reportedly urging Saudi Arabia to unlock its spare capacity, although the country is currently bound by its participation in the OPEC+ deal. There is also optimism that a renewed nuclear deal will be reached with Iran, and the lifting of sanctions would allow Iranian oil to return to the world market.

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