In a pretty impressive act of journalism, the Associated Press recently conducted a “statistical analysis of 36 years of monthly, inflation-adjusted gasoline prices and U.S. domestic oil production.” The result: “No statistical correlation between how much oil comes out of U.S. wells and the price at the pump.” It’s neat to see math cut through the talking points and get straight to the truth of the matter — which is that expanding drilling is a fundamentally ineffectual response to gas price spikes.
Given that changes in U.S. oil production don’t move gasoline prices, it should be clear that U.S. government policies related to drilling are of even smaller consequence. Indeed, 92 percent of economists surveyed by the Chicago Booth School of Business agreed this week that “changes in U.S. gasoline prices over the past 10 years have predominantly been due to market factors rather than U.S. federal economic or energy policies.”
Still not convinced? How about another 20 economists and analysts from across the political spectrum who will tell you the same thing:
- Ken Green, American Enterprise Institute, “If the U.S. produced more of its own oil, it would probably reduce imports, but it’s not likely that it would reduce prices … We probably cannot produce so much oil to exert downward pressure on prices compared to the world market.”