It was a phenomenal week in the oil and gas industry with prices hitting a three-year high, rig counts soaring, and exploration expanding. Fuelled by an accelerated uptick in crude oil demand as the world sets sights on a return to pre-crisis times, oil and gas companies are set for record-breaking free cash flows this summer.

Judge Terry A. Doughty, a federal judge in Louisiana, issued a preliminary injunction blocking the Biden Administration from pausing new oil and gas leases on federal land. The action comes after the administration suspended federal leasing activities in January to review the program’s environmental costs, a move widely seen as Biden’s first step to delivering on climate change campaign promises. But Doughty said the administration does not have the legal right to stop leasing federal territory for oil and gas production without approval from Congress, arguing the suspension was against the law and would cause economic damage and kill jobs. While U.S. Interior Secretary Deb Haaland said her department was reviewing the decision, tensions are beginning to rise with the summer heat.

Carbon dioxide in the atmosphere is at its highest level in modern history and 50% higher than in preindustrial times, according to new findings from the National Oceanic and Atmospheric Agency (NOAA) and the Scripps Institution of Oceanography. While this news does not bode well for the fossil fuel industry, it does provide an opportunity for investment in carbon capture technology. Private CCS developments, supported by state funding, are cropping up around the globe as a means to tackle the rising levels of carbon dioxide in the atmosphere, and fossil fuel firms all seem to be jumping on board in a bid to meet net-zero targets without giving up on traditional energy sources.

In a wild week in oil and gas, crude oil prices hit their highest levels in two years, the International Energy Agency abruptly altered their projections on a return to pre-pandemic oil demand levels, all capped by Russia announcing the fact they are considering ditching dollar-denominated crude oil contracts if faced with more U.S. sanctions. Russian Deputy Prime Minister Alexander Novak noted that ideally they would prefer not to move away from the dollar as it is an international currency used for settlements, but if the Biden Administration continues to impose targeted economic sanctions on Russia, they have no other choice but gradually do that.