One of the most-asked questions and also least clarified is: “Why have oil prices quadrupled over the last decade with U.S. demand lower and production on the upswing?”
Since 2007, U.S. oil demand has declined by two million barrels per day, while fracking-induced production has simultaneously risen by three million barrels per day. This has reduced the difference between U.S. consumption and U.S. production — which was 13.6 million BPD in 2007, to less than 9 million BPD by the end of 2013. This still leaves a major import gap, which must be consummated by overseas purchases.