Debunking the drill-your-way-to-low-gas-prices myth

 

Something funny happened over the last few weeks. First, the price of oil started climbing. Then, the announcement came that U.S. fields were producing more oil than they had since 1989. Wait? Isn't that exactly the opposite of what's supposed to happen under the energy independence myth?

The myth goes something like this: The more oil we extract from U.S. ground, the less oil we need to import from the Middle East. As our dependence on Middle Eastern oil drops, so does the volatility of oil prices caused by geopolitical forces and supply chain disruptions. In other words, the more we drill here at home, the less we pay at the pump.

Nope. We’re now producing more oil domestically than we have since 1989. But back then, the price of oil was about $20 per barrel. Today, it’s over $100, which translates to the price at the pump. As the two graphs below show, domestic production has virtually no effect on oil prices. Whether oil is drilled in North Dakota or Kuwait, it’s tied into the global market, where prices are dictated by global supply, demand and geopolitical forces. Much of the new demand is coming from Asia, which has driven prices higher generally. Meanwhile, tension over the possibility of a U.S. military strike in Syria was to blame for the recent price spike. While we're getting a lot of oil out of North Dakota, it's not and never will be enough to dilute these global forces.

So much for drilling our way to energy independence and low gas prices.

U.S. oil production is higher than it's been since 1989. Graph by the author, based on data from the Energy Information Administration.

Oil prices shot up a decade ago, based in part on increased demand from China and India. After a big dip during the Recession, they went back up and stayed there, regardless of domestic production. Source: EIA.

Jonathan Thompson is a senior editor at High Country News. Follow him on Twitter @jonnypeace.

High Country News Classifieds
  • PROFESSIONAL GIS SERVICES
    Custom Geospatial Solutions is available for all of your GIS needs. Affordable, flexible and accurate data visualization and analysis for any sized project.
  • FREE RANGE BISON AVAILABLE
    Hard grass raised bison available in east Montana. You harvest or possible deliver quartered carcass to your butcher or cut/wrapped pickup. Contact Crazy Woman Bison...
  • CONSERVATION ASSOCIATE - OKANOGAN LAND TRUST (NORTH CENTRAL WA)
    Do you enjoy rural living, wild places, and the chance to work with many different kinds of people and accomplish big conservation outcomes? Do you...
  • CARDIGAN WELSH CORGIS
    10 adorable, healthy puppies for sale. 4 males and 6 females. DM and PRA clear. Excellent pedigree from champion lineage. One Red Brindle male. The...
  • A CHILDREN'S BOOK FOR THE CLIMATE CRISIS!!
    "Goodnight Fossil Fuels!" is a an engaging, beautiful, factual and somewhat silly picture book by a climate scientist and a climate artist, both based in...
  • DIGITAL ADVOCACY & MEMBERSHIP MANAGER
    The Digital Advocacy & Membership Manager will be responsible for creating and delivering compelling, engaging digital content to Guardians members, email activists, and social media...
  • DIGITAL OUTREACH COORDINATOR, ARIZONA
    Job Title: Digital Outreach Coordinator, Arizona Position Location: Phoenix or Tucson, AZ Status: Salaried Job ID Number: 52198 We are looking for you! We are...
  • DESCHUTES LAND TRUST VOLUNTEER PROGRAM MANAGER
    The Deschutes Land Trust is seeking an experienced Volunteer Program Manager to join its dedicated team! Deschutes Land Trust conserves and cares for the lands...
  • ASSOCIATE DIRECTOR OF DEVELOPMENT
    The Nature Conservancy in Wyoming seeks an experienced fundraiser to join our team. We're looking for a great communicator who is passionate about conservation and...
  • INDIAN COUNTRY FELLOWSHIP
    Western Leaders Network is accepting applications for its paid, part-time, 6-month fellowship. Mentorship, training, and engaging tribal leaders in advancing conservation initiatives and climate policy....
  • MULESHOE RANCH PRESERVE MANAGER
    The Muleshoe Ranch Preserve Manager develops, manages, and advances conservation programs, plans and methods for large-scale geographic areas. The Muleshoe Ranch Cooperative Management Area (MRCMA)...
  • ARTEMIS PROGRAM MANAGER
    Founded in 1936, the National Wildlife Federation (NWF or Federation) is America's largest and most trusted grassroots conservation organization with 52 state/territorial affiliates and more...
  • ASSISTANT OR ASSOCIATE PROFESSOR OF ENVIRONMENTAL HUMANITIES
    Assistant or Associate Professor of Environmental Humanities Whitman College The Environmental Humanities Program at Whitman College seeks candidates for a tenure-track position beginning August 2023...
  • EXECUTIVE DIRECTOR
    High Country Conservation Advocates (HCCA) in Crested Butte, CO is seeking an enthusiastic Executive Director who is passionate about the public lands, natural waters and...
  • ASSOCIATE DIRECTOR OF VOLUNTEER PROGRAMS
    Are you passionate about connecting people to the outdoors? The Pacific Crest Trail Association (PCTA) is looking for someone with volunteer management experience to join...
  • EXECUTIVE DIRECTOR
    The conservation non-profit Invasive Species Action Network seeks an executive director. We are focused on preventing the human-caused spread of invasive species by promoting voluntary...
  • NEW BOOK: A FEAST OF ECSTATIC VERSE AND IMAGERY
    Dynamic fine art photographer offers use of images to raise funds. Available for use by conservation groups. Contact at www.anecstaticgathering.com.
  • WANTED: TALENTED WRITER
    Write the introduction to A Feast of Ecstatic Verse and Imagery, a book concerning nature and spirituality. Contact at www.anecstaticgathering.com. Writer who works for conservation/nature...
  • MT STATE DIRECTOR- THE WILDERNESS SOCIETY
    The Montana State Director is a member of The Wilderness Society's (TWS) Conservation program team who plays a leading role in advancing the organization's mission...
  • HIGH COUNTRY NEWS EDITORIAL INTERNS
    High Country News, an award-winning magazine covering the communities and environment of the Western United States, is looking for its next cohort of editorial interns....