How Chuck Schumer is run­ning on fumes

His lat­est claims about the price of gaso­line are patently false

The Washington Times Daily - - OPINION - By Jeff Dunetz Jeff Dunetz is pub­lisher of Lid’s Vids (Lid­sVids.com) and The Lid (LidBlog.com), and a po­lit­i­cal colum­nist at The Jewish Star.

Se­nate Mi­nor­ity Leader Chuck Schumer ev­i­dently hasn’t vis­ited a gas sta­tion this year. If he had, he’d re­al­ize that his re­cent di­a­tribe against the oil in­dus­try is based on a com­plete fic­tion. Dur­ing a re­cent tele­vi­sion ap­pear­ance, Sen. Schumer lamented that “gas prices are sticky. You know … when the price for oil goes up on the mar­kets, it goes right up, but it never goes down.” New York’s se­nior se­na­tor fur­ther claimed that big en­ergy com­pa­nies are sti­fling com­pe­ti­tion to keep prices high.

Th­ese as­ser­tions are patently false, as any­one who has re­fu­eled his ve­hi­cle or paid a util­ity bill lately can at­test. Our do­mes­tic en­ergy boom has re­sulted in some of the low­est gaso­line and elec­tric­ity prices Amer­i­cans have seen in decades.

Amer­i­can en­ergy pro­duc­tion has surged in re­cent years thanks to hy­draulic frac­tur­ing and hor­i­zon­tal drilling. Th­ese tech­nolo­gies have en­abled en­ergy com­pa­nies to har­vest oil and nat­u­ral gas from Amer­ica’s nu­mer­ous un­der­ground shale rock for­ma­tions. As re­cently as 2010, Amer­ica trailed both Saudi Ara­bia and Rus­sia in oil and gas de­vel­op­ment. To­day, the United States is by far the largest pro­ducer of th­ese fu­els.

The na­tion’s en­ergy dom­i­nance isn’t likely to sub­side any­time soon. A new re­port from the U.S. En­ergy In­for­ma­tion Ad­min­is­tra­tion projects that do­mes­tic crude oil pro­duc­tion will break all pre­vi­ous records in 2018, av­er­ag­ing 9.9 mil­lion bar­rels per day — a nearly 100 per­cent in­crease from 2008 lev­els. And the United States is pro­duc­ing so much nat­u­ral gas that it be­came a net ex­porter for the first time in April, ac­cord­ing to the In­ter­na­tional En­ergy Agency.

The mas­sive in­crease in Amer­i­can pro­duc­tion has bro­ken OPEC’s stran­gle­hold on the oil mar­ket and helped drive down crude prices from over $140 per bar­rel in 2008 to less than $50 per bar­rel to­day.

Gaso­line prices, which closely track crude oil prices, have plum­meted too — con­trary to Mr. Schumer’s claims. In 2016, a gal­lon of reg­u­lar gaso­line cost only $2.15 on av­er­age. In in­fla­tion-ad­justed terms, gaso­line hadn’t been that cheap since 2003.

Mo­torists con­tinue to en­joy low gaso­line prices. Roughly a quar­ter of gas sta­tions na­tion­wide cur­rently sell fuel for less than $2 a gal­lon. In early Au­gust, the av­er­age price of a gal­lon of reg­u­lar gaso­line was only $2.32, com­pared to $4.11 in July 2008.

A cou­ple of dol­lars a gal­lon may not seem like much to Mr. Schumer, but it’s life-changing for av­er­age Amer­i­cans. Be­tween 2008 and 2014, house­hold gaso­line ex­pen­di­tures fell by nearly 18 per­cent. They con­tin­ued to fall the fol­low­ing year, sav­ing Amer­i­can mo­torists $115 bil­lion be­tween 2014 and 2015 — about $550 per driver, ac­cord­ing to AAA.

Nat­u­ral gas prices have sim­i­larly plum­meted. Power plants use the fuel to gen­er­ate elec­tric­ity. Util­ity com­pa­nies cur­rently pay just over $4 per thou­sand cu­bic feet of gas. In July 2008, they paid over $12. That’s why res­i­den­tial elec­tric­ity costs fell for the first time 14 years in 2016.

Thanks to low gaso­line and elec­tric­ity prices, en­ergy ex­pen­di­tures ac­counted for just 3.9 per­cent of to­tal house­hold spend­ing last year — a record low.

It’s re­mark­able that this un­prece­dented drop in en­ergy costs has some­how eluded Mr. Schumer. Af­ter all, it was 11 years ago that he urged Pres­i­dent Ge­orge W. Bush “to re­duce sky­rock­et­ing prices at the gaso­line pump by tap­ping the Strate­gic Petroleum Re­serve.” Back then, Mr. Schumer iden­ti­fied Amer­ica’s reliance on for­eign oil and gas as “one of the great prob­lems Amer­ica will face in the next quar­ter cen­tury.”

We’ve since solved that prob­lem — not by sell­ing off strate­gic as­sets, but by tap­ping Amer­ica’s rich shale oil and gas de­posits. Mr. Schumer’s slan­der against the oil and gas in­dus­try is un­founded and un­de­served. Th­ese com­pa­nies have de­liv­ered hun­dreds of bil­lions in sav­ings to reg­u­lar Amer­i­cans and freed us from our en­ergy de­pen­dence on volatile for­eign gov­ern­ments.

IL­LUS­TRA­TION BY GREG GROESCH

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.