Why are U.S. oil prices so high?
Oil investors are pushing U.S. oil companies to pump less oil during an economic expansion as demand is for oil is rapidly increasing.
U.S. oil companies are seeing high prices for the first time in a decade and oil investors want profits, not supply. According to the U.S. Energy Information Administration (EIA), “Most of the crude oil produced in the United States is refined in U.S. refineries along with imported crude oil to make petroleum products.” While the exact percentage is unknown by the EIA, the majority of the domestic oil demand is met with U.S. oil.
Oil prices in the United States are more directly linked to domestic oil production than OPEC limits or the cost of imports. Although increased OPEC production would put pressure on U.S. oil companies to increase production in order to avoid seeing their exports replaced by other producers.