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Data: FactSet; Chart: Axios Visuals

Oil prices have rallied sharply in recent days, but the market remains depressed and the gains are too small and too late to prevent deep pain for the industry.

Why it matters: The general upward trend of late is nonetheless a sign that the worst of the pandemic-fueled collapse in prices and demand — which is stressing oil storage capacity — may be over.

Driving the news: Futures prices for West Texas Intermediate, the U.S. benchmark, have essentially doubled since early last week and are trading around $23.29 this morning. Brent crude also gained, trading around $30.31.

Threat level: They're also giving back some of those gains this morning, underscoring the tumult and risk.

What they're saying: "These moves have been encouraging but there may be a few more fireworks yet unless we see evidence that near-term surpluses are shrinking," OANDA analyst Craig Erlam said in a note Wednesday.

But, but, but: Prices are still at a level that creates financial jeopardy for many producers and other segments of the industry, and companies are being forced to cut production.

More signs of the toll emerged Tuesday.

  • Big U.S. producer Occidental Petroleum reported a $2.2 billion first-quarter loss and announced further cuts in capital spending.
  • Refining giant Marathon Petroleum posted a $9.2 billion quarterly net loss as it took a $12.4 billion impairment charge. FT has more.

Go deeper

U.S. oil production saw biggest decline since 1980 in May

Data: EIA; Chart: Axios Visuals

U.S. oil production's nearly 2 million barrel per day decline in May was the steepest monthly drop since at least 1980, the federal Energy Information Administration said in a short report.

Why it matters: The agency's monthly production data, which is more robust than weekly snapshots but arrives with a lag, starkly shows the toll the pandemic took on U.S. output after the price collapse caused a major pullback. Some of the lost output has recently returned as prices improved, but production is expected to remain depressed.

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Why it matters: Bottom lines and investor returns will be vastly different across the corporate spectrum depending on how aggressively the world tackles climate change in the coming decades.

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Why it matters: Nikola is attracting lots of attention for plans to build a line of semi-trucks, as well as a pickup, in the coming years as it tries to break through in those fledgling markets.