The Des Moines Register suggests oil prices are increasing despite increased domestic oil production. However, the two are not necessarily related. The increase price of oil is due to worldwide forces said John Felmy, Chief economist of the American Petroleum Institute.
“Crude oil prices are two-thirds of the price of gasoline, and if you convert crude from barrels to gallons, the price of oil is up 37 cents per gallon in the last month,” said Felmy.
Felmy continued to explain that parts of the world are seeing increases in demand for motor gasoline, especially in China. Other contributing factors include upset in the Middle East, particular for European Brent Crude oil.
The U.S. Department of Energy suggests that ethanol is also a contributing factor to increased prices. In fact, ethanol prices have risen 60 cents per gallon in the last month, following increase price of corn.
The Energy Department said last week that “if that 60-cent increase were all passed through to consumers, it would raise retail E10 gasoline prices by 6 cents per gallon, but there is little evidence this has occurred.”
Hydraulic fracturing in the United States is more than just a method of extracting natural gas from the ground, it’s an opportunity to gain independence from foreign oil sources. As you can see and probably already know, the price of oil can increase at any given moment for reasons the lie beyond our control.
Why is hydraulic fracturing controversial, if we’ve been “fracking” for years? What makes fracking a subject to public scrutiny now, but not 50 years ago. Manufacturing facilities and a number of industrial vehicles already use natural gas under the Administration’s Clean Air Act, which demands new facilities to cut carbon emissions. Natural gas reduces carbon emissions and is a positive step forward to cleaner energy future.