I have enjoyed the price of gasoline recently, and I am not alone. It has been a breath of fresh air and to pay about $25 to fill up.
Trying to discern why prices are so low, based on the news is difficult. It appears that the media doesn’t think the event is noteworthy, or if they have made a story of it, they have not dug into the why question.
An internet search came up with many possible answers. One source said supply was up because of better methods of producing oil. I suspect this is true in minor ways, but also expect it to be only a part of the story.
Another source indicated demand was down. Of course, this answer should be readily verifiable by a decrease in traffic. So far, I don’t see it. Of course, the impact of producing heating oil as opposed to gasoline is a possible factor, but I can’t figure the heating oil amounts being that much lower either.
A theory of my own is that the nations who sell large amounts of oil to us are afraid of losing their market. It is true we have increased our ability to produce, and some portions of US politics and economy want to become energy stable, if not outright independent. Not only this, but the US is currently in a political fight to build pipelines which will allow for greater and safer production.
Dropping oil prices are a way to making Americans less concerned about our life blood being supplied by other countries. Dropping oil prices make American companies less profitable when making oil locally. And dropping oil prices demotivates those fighting the political battles in favor of American oil.
I am guessing the lower prices are simply the result of us making the world oil supply be a competitive market.
Charles W. Short 