(CSM) The US is awash in new oil. So why are gas prices still so high?

With oil and natural gas production soaring in the US, consumers might expect lower prices at the pump and on their electric bills.

But that’s not happening. The summer driving season was the fourth most expensive on record, and residential electricity costs ballooned in the first half of 2014.

Meanwhile, US oil and natural gas production surges, fueled by innovative drilling in states like Texas, North Dakota, and Pennsylvania. Today, the US is the world’s largest producer of natural gas, and oil production rivals energy giants like Russia and Saudi Arabia.

So why are American consumers paying more, even as the supply of American fuel expands?

Read it all.


Posted in * Culture-Watch, * Economics, Politics, * International News & Commentary, America/U.S.A., Consumer/consumer spending, Corporations/Corporate Life, Economy, Energy, Natural Resources, Globalization, Personal Finance

4 comments on “(CSM) The US is awash in new oil. So why are gas prices still so high?

  1. Jim the Puritan says:

    1. Fuel taxes and surcharges.

    2. Government requirements to blend in ethanol, which is more expensive, must be separately shipped in, and is less energy efficient, meaning you have to consume more ethanol and gasoline to go the same distance.

  2. Katherine says:

    3. No new refineries.

    2(a). And ethanol isn’t good for engines.

  3. Jim the Puritan says:

    Yes, both our local refineries have shut down in the past 2-3 years because of environmental regulatory costs. So both ethanol and gasoline now have to be shipped here and blended.

  4. Sarah says:

    My understanding is that we’re simply not building or maintaining refineries any more — so we have a huge production bottleneck there — due to the costs of the insane regulations. But then . . . that was always the point anyway — to slow down production just as the point is to make coal regulated out of business and the cost of electricity as well to skyrocket. That will, the theory goes, make us use less.

    So it gibes with the above comments.