Posted December 29, 2014
Enjoying Your Cheap Gas? Thank Fracking
The Week: One of the biggest stories of 2014 has been the astonishing drop in global oil prices. The price of the benchmark Brent crude went from over $100 per barrel at the beginning of the year to the $60 range as of this writing.
It's worth noting how massive and completely unexpected this price drop has been.
And it's worth noting how good it is for the U.S. economy. The price of oil is one of the biggest drags on consumer demand, the largest driver of the economy.
And to what do we owe this miraculous event?
In a word: fracking.
Fracking has allowed the U.S. to extract a lot more oil from the ground, but also a lot more natural gas. As natural gas replaces oil as a power source, the demand for oil falls, which, all else being equal, lowers prices.
Read more: http://bit.ly/1y1oOLa
More industry news:
- U.S. Crude Oil Imports Continue Downward Spiral in 2014 as Production Soars: http://bit.ly/148ZWEV
- Oil’s Swift Fall Raises Fortunes of U.S. Abroad: http://nyti.ms/1teeoBf
- New York Takes the Wrong Approach to ‘Fracking’: http://wapo.st/1BjYutb
- Editorial: Driving U.S. Rebound – The Fracking Loathed by Liberals: http://bit.ly/13OJgBV
- Column: Nevermind U.S. Shale, Saudi Arabia’s Oil Power Play Targets Iran’s Economy: http://bit.ly/1BffHV6
- Column: Is U.S. in an Oil Price Nirvana? http://bit.ly/13OKbSO
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.