A couple of data points for the minority leader of the U.S. Senate, who asserted earlier this week that gasoline prices never go down.
The first point is that gasoline prices have come down. Nationally, the average price of a gallon of gasoline the third week of July was $2.392 – about 42 percent lower than the national average price at the same time in 2008, according to the U.S. Energy Information Administration:
Retail gasoline prices haven’t been “sticky,” as Sen. Charles Schumer said on ABC’s “This Week,” suggesting that some sort of anti-Adam Smith force has kept them from decreasing:
Yet, as we can see, they have decreased significantly over a time period that coincides with accelerated U.S. crude oil production (thanks, fracking):
What we’ve seen is the impact of U.S. energy production. U.S. output has meant added supply to global crude markets, putting downward pressure on those markets. This has contributed to savings at the gasoline pump for American consumers, allowing more disposable income for groceries and other purchases, summer vacations and other activities.
In 2015, AAA reported, Americans saved more than $115 billion on gasoline compared to the year before, an average of more than $550 per licensed driver. Earlier this month, AAA said the average price of gasoline around Independence Day – in the heart of the summer driving season – was the cheapest the country had seen all year. AAA’s Jeanette Casselano:
“The combination of tepid demand and increased gasoline and crude output continues to put downward pressure on gas prices.”
America’s energy renaissance has delivered for America – in consumer savings at the pump and home heating costs, in economic growth, increased security and environmental benefits because of increased use of cleaner-burning natural gas.
Our sense is that most Americans – Sen. Schumer being among the few exceptions – are quite aware of trends at the gasoline pump, and many likely connect those trends with increased domestic energy production. Regular Americans fill their own fuel tanks, are cognizant of what they have paid for gasoline and have valued the savings. That’s a good energy storyline.
By Mark Green
Originally posted July 26, 2017
Energy Tomorrow is brought to you by the American Petroleum Institute (API), which is the only national trade association that represents all aspects of America’s oil and natural gas industry. Our more than 500 corporate members, from the largest major oil company to the smallest of independents, come from all segments of the industry. They are producers, refiners, suppliers, pipeline operators and marine transporters, as well as service and supply companies that support all segments of the industry.
