Posted November 27, 2014
Happy Thanksgiving everybody.
When it comes to energy there’s much for which Americans can give thanks.
We have plentiful and accessible reserves of oil and natural gas that fuel healthy, mobile, modern lifestyles.
We enjoy safe and secure crude oil imports from Canada, our neighbor and ally and No. 1 source of imported oil.
Our country is served by a vibrant, modern industry – one that’s second to none in the use of safe, hydraulic fracturing and horizontal drilling, offshore development and environmental awareness.
America keeps running thanks to a vast pipeline network and the world’s biggest, most-efficient refineries. And there’s more.
Today, though, let’s focus on a couple of items in the news.
First, there’s this chart posted this week by energy/economics blogger Mark J. Perry:
Perry’s graph shows that domestic energy production as a share of consumption has reached a point (86.2 percent) not seen in more than three decades – the very definition of increasing energy security. The chart basically shows the game-changing arc of America’s ongoing energy revolution – the surge in domestic oil and natural gas production that began less than a decade ago. That revolution, built on shale energy and fracking, has rewritten the United States’ energy story.
America has been transformed from a country dependent on increasingly precarious levels of imported oil to one that soon will lead the world in oil production. For the first time in four decades, the U.S. can seriously consider exporting some of its crude. Gregory Zuckerman, Wall Street Journal writer and author of “The Frackers,” tweets:
The U.S. already is the world’s No. 1 producer of natural gas. Thanks to fracking, instead of worrying about importing natural gas to meet domestic needs, the U.S. is poised to become a leader in the global market for exported liquefied natural gas (LNG).
Increased energy security means the U.S. is stronger economically and safer strategically in the world. The U.S. is positioned to make significant contributions to global energy supplies, diversifying supplies in ways that will help America’s friends.
News item No. 2: U.S. retail regular-grade gasoline prices continue to fall, averaging $2.82 per gallon, according to the U.S. Energy Information Administration (EIA). EIA reports:
This average is 47 cents lower than a year ago, and the lowest price heading into a Thanksgiving holiday since 2009. … Much of the decline in gasoline prices since mid-2014 is attributable to falling crude oil prices. The combination of robust U.S. crude oil production growth, a return of Libyan production (despite recent setbacks), weakening expectations for the global economy (particularly in China), and seasonally low refinery demand has reduced oil prices. North Sea Brent spot prices have fallen from a July monthly average of $112 per barrel (bbl) to a November monthly average of $80/bbl (through November 24). The average U.S. retail regular-grade gasoline price has fallen 88 cents/gal since the start of July.
EIA charts the decline here, comparing 2014 retail prices (red) with 2013 (green) and 2012 (blue):
In other words, American consumers are reaping benefits from America’s energy revolution. Growth in domestic energy production is having an effect on global supplies, putting downward pressure on the cost of crude oil, the leading variable in prices at the pump.
Energy security and falling gasoline prices that are benefiting consumers. Happy Thanksgiving, America – enjoy your early Christmas presents.
ABOUT THE AUTHOR
Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.