Can anyone explain why oil prices are going up at the same time production is? Shouldn’t prices be coming down?
If demand is increasing even more than supply, then the price will go up.
“Can anyone explain why oil prices are going up at the same time production is?”
Two reasons:
1. The Global market is ultimately the main driver of the price. Global demand is rising (all of the 45 biggest economies expanding at the same time - Thank You President Trump). Supply outside the USA was constrained - some other major producers are producing less, notably Venezuela, which is collapsing. OPEC and Russia agreed to significantly restrain their production, to run down inventories, and drive up prices.
2. Inventory levels are the most important measure of supply, for prices in the near term. US inventories declined last year, because of the hurricane disruption, and a big increase in demand for US exports, due to a significantly lower price in the USA (driven by what was then near capacity US inventory levels).