“..but new drilling activity has declined to multi-decades lows.”
New drilling has declined due to a slackening of demand which has been brought about by the China Virus shut down. This will change as the country gets back to work.
Stop using logic, you racist!
Perhaps, but I think you don’t grasp the extent of the crash in oil/gas that has taken place over the last year - and especially with Covid19, as you point out.
total national Rig counts as of 2 weeks ago are at 244. Prior to 2020, In the last 40 years, this figure has never been below 600. 200 oil and gas companies have gone bankrupt and the industry (and their banks/bondholders) have lost $300 billion in the last year. Yes, the market will respond, but there’s a significant lag to re-start drilling activity, and its going to take A LONG period of much higher prices to convince investors to put their money back into this sector.
And Much higher prices for everything will definitely be coming.