Source: https://seekingalpha.com/article/447602 ... nal-energy
"US energy policy means dependence
It is no surprise that the open interest metric in NYMEX futures declined with the price. Trend-following longs likely exited positions as the price fell. However, another possible explanation is the shift in US energy policy, causing lower output levels and less producer hedging in the futures arena. The drop took the metric to its lowest level in half a decade.
The Biden administration canceled the Keystone XL pipeline in January 2021. In May, it banned drilling and fracking for oil and gas on federal lands in Alaska. The administration’s greener path is also looking to shut down other pipelines and increase fossil fuel production regulations. While the administration is turbocharging the move away from hydrocarbons in favor of alternative renewable energy sources, the US and the world continue to depend on crude oil. Around one percent of US cars operate on electricity, while the rest are gasoline-powered.
The shift in US energy policy in 2021 came when the demand was soaring. After years of losing market share to the US and suffering from low prices, OPEC, the international oil cartel, and Russia now dominate global production. According to the Energy Information Administration, despite the booming demand, US output fell from a peak of 13.1 million barrels per day in March 2020 to the 11.7 mbpd level as of the week ending December 10, 2021. US output would be much higher because of demand, but addressing climate change is the current policy path.
The US has been losing its grip on energy independence. As a sign of the transition, the Biden administration twice asked OPEC+ to increase output because gasoline prices rose to the highest level since 2014. The cartel refused, leading November’s fifty million barrel SPR release. However, fifty million barrels only account for three days of US consumption, so the move was symbolic and came at a seasonally weak time of the year when gasoline demand tends to decline.
The bottom line is that after working to establish energy independence, the US has become more dependent on the Middle East than it had been over the past years, if not decades, in 2021."
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BTW, I'm in NYSE:ERX and I've made a bundle off of it since buying it in Spring of last year. I'll continue to hold it.