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Study: 36 years of data show no link between gas prices and domestic drilling for oil

 

The political demagogues are just plain wrong when they blame high gasoline prices on the Obama administration’s alleged aversion to domestic drilling for oil.

For one thing, domestic oil production has increased, not decreased, under President Obama.

For another thing, America is less dependent on foreign oil under Obama.

And the clincher: The “drill, baby, drill” approach to bringing gas prices down is nonsense, as we see HERE:

It’s the political cure-all for high gas prices: Drill here, drill now. But more U.S. drilling has not changed how deeply the gas pump drills into your wallet, math and history show.

A statistical analysis of 36 years of monthly, inflation-adjusted gasoline prices and U.S. domestic oil production by The Associated Press shows no statistical correlation between how much oil comes out of U.S. wells and the price at the pump.

If more domestic oil drilling worked as politicians say, you’d now be paying about $2 a gallon for gasoline. Instead, you’re paying the highest prices ever for March.

Political rhetoric about the blame over gas prices and the power to change them — whether Republican claims now or Democrats’ charges four years ago — is not supported by cold, hard figures. And that’s especially true about oil drilling in the U.S. More oil production in the United States does not mean consistently lower prices at the pump.

Sometimes prices increase as American drilling ramps up. That’s what has happened in the past three years. Since February 2009, U.S. oil production has increased 15 percent when seasonally adjusted. Prices in those three years went from $2.07 per gallon to $3.58. It was a case of drilling more and paying much more.

 

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9 Comments

  1. Milton Waddams

    I’m so sick of the term foreign oil, as if it means anything. There is no foreign or domestic when it comes to oil. There is just oil. It is a global commodity and as such multinational oil companies are going to sell it to whomever they can get the most most money. What’s worse is that we as a society bear all the externality costs of the refining process here. Health, air and water pollution. Then the refined fuel is exported to other countries and those external costs are left with us and not reflected in the price of the refined fuel.

  2. Except we get to have the jobs.

  3. doc: Domestic drilling and oil production are up sharply under Obama, thereby creating jobs. Of course, you wouldn’t know this to be the case to hear your right-wing Republican friends tell it.

  4. I did know that, and that’s great! Do you think that is because of the Obama administration or in spite of it?

    It could be up even more, thereby creating even more jobs. I wasn’t aware that Obama felt he had already created/saved enough jobs.

  5. Here is something to help you answer my question.

    http://www.640wgst.com/pages/RobJohnson.html?article=9889422

    Obama Claim: The U.S. has become a net energy exporter.

    Reality: This claim is 100 percent false. Because the Obama campaign does not provide a single citation or source for their information, it is impossible to know how great its ignorance of energy facts extends. Every year, the Energy Information Administration, which is part of the Obama administration’s Department of Energy, publishes an Annual Energy Review. If the Obama campaign understood energy facts, they would have looked at Table 1.4 of the 2010 Annual Energy Review. They would have found a table titled, “Primary Energy Trade by Source, Selected Years, 1949–2010.” That table shows that in 2010, far from being a net energy exporter, the U.S. had net imports of 21 quadrillion Btus of energy of the 98 quadrillion btus used.

    Bottom Line: The private sector is responsible entirely for the increase in domestic oil and gas output, while the Obama Administration has worked to counter that by putting restrictions on where they can drill and by shutting out more federal land for drilling.

  6. By Mr. Cunningham’s logic, we should stop drilling now and prices will go to $1.00 a gallon. What stupidity. The increase in drilling was FOUGHT by the Obama administration who now wants to take credit for it. The permits being used were well in the pipeline when Obama was expressing the desire for $5/gallon gas. Thank the oil and gas entrepreneurs, not the Obama blockade. We know better on the gulf coast.

  7. WatcherinLa

    Unbiased? I thought this would be an interesting article, but it’s more political hackery. Global demand is up, domestic supply hasn’t kept up, even though domestic demand is down. Public land drilling is DOWN, while private drilling is UP. How many new permits have been issued under Obama’s watch. Get your head out of Obama’s behind. Why do you extremists on the left and right just have such a hard time with the TRUTH.

  8. Tom Genin

    The apples and oranges approach of AP’s study proved the agendized intent of their study. AP didn’t mention that prices for gas tracked with the cost for oil during that time. More Global production led to lower prices and vice versa. News to libs, America is part of the global production. Now, if America does produce more, Saudi may lower production to keep the costs up, but guess what. At least then the $22 Billion a day is staying in the US instead of being sent to other countries. AP didn’t mention that either, Did They?

  9. All we have to do is stop selling our gasoline on the international market and sell it all here at home. Our domestic supply will go up and the price per gallon will go down. We have plenty of gasoline if we would just sell it here. The oil companies are putting high profits ahead of our national interest.

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