Why do Gasoline Prices stay so high?
Posted: Wed Jun 25, 2014 11:04 am
When one of your friends asks you why gasoline prices stay so high when the U.S. is producing so much oil, here is what you can tell them.
From the BP Report on World Energy 2014 (available on our website):
Global oil production increased by 557,000 barrels per day (bpd) to a new all-time high of 86.8 million barrels per day. Note that BP's definition of "oil" includes crude oil, tight oil, oil sands and natural gas liquids (NGLs -- the liquid content of natural gas where this is recovered separately). Its definition excludes liquid fuels from other sources such as biomass and derivatives of coal and natural gas (e.g., coal-to-liquids, or CTL).
There are two very large caveats that accompany this new global production record. The first one is that the US contribution to the global oil supply was a 1.1 million bpd increase over the previous year. This was the largest year-over-year increase in US history (and eclipses the previous record US gain in 2012). Without this large US increase -- driven by the fracking/shale oil and gas boom -- global oil production would have actually declined by 554,000 bpd.
The rest of the world is on the back side of Peak Oil. Without the U.S. Shale Plays, gasoline would already be $5.00/gallon and moving higher. - Dan
From the BP Report on World Energy 2014 (available on our website):
Global oil production increased by 557,000 barrels per day (bpd) to a new all-time high of 86.8 million barrels per day. Note that BP's definition of "oil" includes crude oil, tight oil, oil sands and natural gas liquids (NGLs -- the liquid content of natural gas where this is recovered separately). Its definition excludes liquid fuels from other sources such as biomass and derivatives of coal and natural gas (e.g., coal-to-liquids, or CTL).
There are two very large caveats that accompany this new global production record. The first one is that the US contribution to the global oil supply was a 1.1 million bpd increase over the previous year. This was the largest year-over-year increase in US history (and eclipses the previous record US gain in 2012). Without this large US increase -- driven by the fracking/shale oil and gas boom -- global oil production would have actually declined by 554,000 bpd.
The rest of the world is on the back side of Peak Oil. Without the U.S. Shale Plays, gasoline would already be $5.00/gallon and moving higher. - Dan