Vail Daily editorial: A welcome gift
This has been a weird, unsettling year. But as we look toward 2015, most of the civilized world has received a welcome Christmas present — plummeting fuel prices.
According to AAA Colorado, the price of regular fuel in Vail as of Tuesday was about 50 cents per gallon lower today than it was on the same date in 2013. The spread was even more pronounced in Glenwood Springs — a whopping 69 cents per gallon.
That’s a lot. If your family uses 30 gallons of gas a week, you’re saving $15 at the pumps in Vail, and more than $20 in Glenwood.
That, friends, is a small but noticeable pay raise for all of us.
The world oil market is a complex thing, but one of the big reasons for the drop in prices is the unprecedented oil boom in this country. New technology, including horizontal drilling and fracking, has opened up vast new reserves. According to Robert Bryce, a fellow at the Manhattan Institute for Policy Research, a “market oriented” think tank, U.S. oil production has grown by 3.1 million barrels per day in the past decade. That’s about what the nation of Kuwait pumps in a day.
For free-market types, the even better news in the U.S. oil boom is that it has come almost entirely independently of federal energy policies, particularly in the past six years.
A story on CNBC’s website Monday indicates that oil prices could settle in at about $65 per barrel for the next several months. That’s thanks in part to Saudi Arabia, the world’s largest producer of oil, which has decided to keep pumping at current levels.
Whether that decision is based on the country’s desire to go with volume, not price, or it’s an attempt to undercut the higher drilling costs in the U.S., we’ll take it.
We also like the fact that low oil prices are hurting the economies of Russia, Iran and Venezuela, countries that most civilized people view as bad actors on the world stage.
The drop in oil prices isn’t an absolute good. Oil exploration companies in this country are already cutting back, and that’s going to cost the jobs of a number of relatively high-wage workers. That’s never a good thing to write over the Christmas season. But it’s almost a certainty that other industries will thrive as the petroleum business seeks equilibrium.
Abundant, inexpensive energy has for a century been one of the pillars of this country’s economy. We look forward to the growth the current era of low-priced dino-juice will bring.