BY RIGI ANDRADE
Due to the fall in the price of oil per barrel, gas is now at an average of $3 per gallon and consumers have been buying more gas. This low price has not been seen in years.
“All around the country, gasoline prices have been falling for weeks, down to an average of about $3 a gallon,” said Marilyn Geewax of National Public Radio. “Those lower prices are helping restrain inflation across the board.”
“The oil price has fallen by about 25 percent since its peak back in June of $105 a barrel,” said Stephen Moore of the Daily Signal. “This is translating to lower prices at the pump with many states now below $3 a gallon.”
Due to the drop in oil and gas prices, American businesses and consumers can save a total of $200 billion annually if these lower prices remain constant. This helps stimulate the American economy because it is an extra $200 billion we can save.
“At present levels, these lower oil and gas prices are the equivalent of a $200 billion cost saving to American consumers and businesses,” said Moore. “Now that’s an economic stimulus par excellence.”
Some believe the price of gas is dropping because Americans have started to find other forms of energy to use but with Europe’s economy being in a wreck, the European demand for oil has decreased.
The United States has also been able to increase the amount of natural gas it produces through hydraulic fracturing and horizontal drilling. These new methods have increased the domestic supply by 50 percent, while the production of oil has doubled in the last six years in Oklahoma, Texas and North Dakota.
“Demand has slowed because Europe is an economic wreck. But since 2008 the U.S. has increased our domestic supply by a gigantic 50 percent. This is a result of the astounding shale oil and gas revolution made possible by made-in-America technologies like hydraulic fracturing and horizontal drilling” Moore said. “The U.S. has become the number one producer of natural gas.”