By Michael Bastasch
The price of oil fell from about $100 per barrel to $80 per barrel in a matter of months, bringing with it lower gasoline prices for drivers and a modest boost to the economy ahead of the holiday season.
This is all thanks to the advent of hydraulic fracturing, or fracking, and horizontal drilling in the U.S., without which gasoline prices would be nearly one dollar higher and oil would cost as much as $150 a barrel, according to a recent report.
Energy experts at ICF International estimate that “international Brent crude oil prices would have averaged $122 to $150 per barrel in 2013” without the massive increases in oil production from fracking. Instead, oil prices have fallen to around $80 per barrel and are projected to fall even further — maybe even to $60 per barrel.
“Given the international nature of U.S. petroleum product movements, ICF also estimates that 2013 U.S. petroleum product prices were between $0.29 and $0.94 per gallon lower than they would have otherwise been without” fracking, ICF reports.
“This reduction in petroleum product prices have saved U.S. consumers an estimated $63 to $248 billion in 2013 and estimated cumulative savings of between $165 and $624 billion from 2008 to 2013,” ICF notes in its report that was prepared for the American Petroleum Institute — the country’s main oil and gas lobbying group.
Fracking is a well-stimulation process in which water, sand and some chemicals are injected into shale formations deep underground to extract oil and natural gas. This practice, combined with horizontal drilling has revolutionized the U.S. oil and gas industry and put the country on the path to be the world’s largest oil and gas producer.
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Article Source: Bastasch, M. (2014). Report: Without The Fracking Boom, Oil Would Be At $150 Per Barrel. Dailycaller.com. Retrieved from http://dailycaller.com/2014/11/24/report-without-the-fracking-boom-oil-would-be-at-150-per-barrel/