Remember when President Obama said, “[W]ith only 2% of the world’s oil reserves [Actually, America’s crude oil resource is among the largest in the world.], we can’t just drill our way to lower gas prices – not when we consume 20 percent of the world’s oil.” Well the president’s own Department of Energy (DOE) begs to differ.
The Energy Information Administration (EIA), the statistical arm of DOE, released a short analysis of the impact the U.S. energy revolution, led by the widespread use of hydraulic fracturing in shale formations, has had on family budgets since 2008. The title of the piece tells the story: “Declining energy prices lower the cost of living.”
Here’s what EIA had to say:
In constant 2015 dollars, average annual household energy expenditures peaked at about $5,300 in 2008. Between 2008 and 2014, average annual household energy expenditures declined by 14.1%. During this period, household expenditures decreased by 17.7% for gasoline, 25.1% for natural gas, and 28.3% for fuel oil. Electricity expenditures declined by a more modest 0.7%.
That 14.1% decline in average annual expenditures since 2008, when the Shale Gale was just a breeze, translates into a cool $750 per household. More than two-thirds of that came from declining expenditures on gasoline and motor oil.
So if you like lower energy prices—and who doesn’t?—thank the frackers who made it possible.