By Donn Dears
Aug 12, 2016
Prior to the advent of fracking, the United States was running out of natural gas, and LNG import terminals were being built. It should be noted that Democrat activists opposed the building of LNG import terminals, which would have resulted in greater shortages of natural gas if fracking hadn’t been invented.
The price of natural gas was peaking at around $13 per million BTU in 2006 and 2009, compared with the recent henry hub price of around $2 per million BTU.
Eliminating fracking would result in a huge increase in the price of natural gas, which would increase the cost of heating American homes, and increase the cost of electricity for all Americans.
It would also kill jobs.
Since 2009, several chemical companies have been building new facilities in the United States to utilize the low-cost natural gas produced by fracking, to produce chemicals and fertilizer.
Eliminating fracking would result in much higher natural gas prices, causing chemical companies, once again, to export jobs to areas of the world, mostly in the Mideast, where there was low-cost natural gas. Over 400,000 jobs were lost during the 1990s and early 2000s as companies moved chemical plants to where the cost of natural gas was cheap.
Eliminating fracking would also eliminate the possibility of exporting natural gas, with the loss of additional American jobs.
In 2005, the United States imported 10 million barrels of oil daily, or roughly half of US oil consumption.
By 2015, oil imports had been reduced to 7.3 million barrels per day.
The ability of the United States to increase its oil production, as the result of fracking, had an important effect on the U.S. trade deficit.
As the chart shows, oil imports have a huge effect on the U.S. trade balance. With a nearly 30% reduction in oil imports, the trade deficit was substantially reduced. The exporting of petroleum products and crude oil also has a beneficial effect on America’s trade balance.
Without fracking, America’s balance of trade will be badly damaged, with a resulting increase in the, already huge, national debt.
Eliminating fracking also kills oil field jobs, just as the war on coal killed coal mining jobs.
Fracking has forced OPEC to stop attempting to control the price of oil. If fracking is eliminated, OPEC has nothing to prevent it from policies that result in higher oil prices.
Eliminating fracking, when even the EPA has said there was no systemic negative effects on water supply, would cause serious economic harm to the economy and to every American … especially the poor who can least afford higher prices for heating, food and electricity.
- The cost of natural gas to heat homes would increase dramatically
- Industries that use natural gas for producing materials such as steel would see their costs increase
- The cost of electricity would increase, harming Americans and American industry
- The cost of natural gas to chemical companies would increase substantially, with the resulting elimination of thousands of American jobs, just as happened in the 1990s and early 2000s
- The cost of gasoline will increase as OPEC regains control of oil prices
- The cost of food will increase as the cost of operating farm equipment and the cost of transporting farm produce increases as the result of higher oil prices
- Jobs will be killed in the oil field and in manufacturing
- The deficit, which is already over $19 trillion, will increase as trade balances deteriorate
Eliminating fracking would cause great harm to America and Americans.