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Though showing signs of recovery, the ongoing pandemic and recent surge across the US threatens oil industry once again.  “Oil prices have made a surprisingly steady return from the collapse ignited by lockdowns as the virus pandemic grew earlier this year. Crude settled above $40 a barrel Monday for the first time since plunging to negative-$37 on April 20, when the world was awash in unwanted oil. West Texas Intermediate, the U.S. benchmark, settled at $38.49 Friday, down slightly from Thursday. … The recovery, however, now looks tenuous, as no one is certain whether the current surge in COVID-19 cases could lead to business shutdowns and depressed consumer activity. Harris County on Friday issued a new ‘stay home, work safe’ advisory, asking residents to stay home except for essential trips, to work from home if possible and to avoid unnecessary travel.”

Economists say the threat of a “double-dip” is contingent on the scale and level of shutdown initiated by state governments in response to the surge. “A double dip in oil demand and prices will depend on whether state and local governments impose widespread lockdowns or allow businesses to remain open with requirements for face masks and social distancing. … Karr Ingham, a petroleum economist with the Texas Alliance of Energy Producers, said he can’t imagine that state and local governments would impose the type of widespread and strict lockdowns seen in March and April because of the dire economic consequences that such a move would have. It’s unclear how much political willpower there is to mandate a second lockdown, which would undoubtedly prompt public outrage, he said.”

“Carbon emissions reductions brought on by U.S. coronavirus lockdowns could be reversed by the pandemic's long-term damage to the clean energy sector, a new study has found. … To avoid an increase in emissions, lawmakers in the United States should pass stimulus measures to invest in clean energy technologies and boost renewable energy projects and jobs, the study said. If the "silver lining" of the pandemic so far has been reductions in global emissions, then such investments in the United States could be another positive development to come out of the crisis, Gillingham said.”

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Republican Politicians are using the economic fall out from COVID-19 to claim that any environmental expenses are unnecessarily burdening an already struggling economy.

Results from a survey of 168 energy firms show that “Of the oil producers and service companies that responded, only 3% said drilling activity will recover to pre-pandemic levels by the end of the year, while 39% said it will take to 2022 or later and 16% — roughly 1 in 6 energy firms — said it will never recover. The Dallas Fed carried out the survey from June 10-18.”