With oil prices struggling to rebound after hitting a three-month low last week, Americans are getting yet another reminder of just how wrong President Barack Obama was about drilling.
“The American people aren’t stupid,” he said back in 2012 — when the price of oil was above $100 a barrel and gas was $3.50-plus a gallon at the pump. They know “we can’t just drill our way to lower gas prices.”
Well, he was right about one thing: Americans aren’t stupid. They wisely ignored him and drilled anyway. Guess what? Supplies rose and drove down prices. They haven’t come back since.
Hug a fracker for that welcome turn of events: US oil output from shale has soared over the past decade, thanks to new fracking and horizontal-drilling technology that has lowered production costs and made shale-oil extraction economical.
(And blame Gov. Cuomo for banning New Yorkers from taking part in the fracking boom.)
The new reserves have disrupted the global oil market: While OPEC countries and Russia agreed last November to cut production by nearly 1.8 million barrels a day to run down inventory gluts, US output has grown: Drillers here have added oil rigs for the past eight straight weeks.
The US supplies have kept world crude prices low — oil has been bouncing around just above the $50-a-barrel mark; gas, just below $2.50 a gallon — despite the cuts in output by OPEC and Russia.
Indeed, those countries are now rethinking their production caps to hang on to their market share.
But whether it’s America, OPEC or Russia that keeps the black stuff flowing, crude and gas-pump prices don’t seem headed up much anytime soon. That’s a godsend for consumers, as well as businesses and workers.
No, there are no guarantees: If the global economy heats up and supplies can’t keep pace, prices will rise. But with all the new US drilling, America is now better poised to meet new demand and keep those prices in check.