Business and Economics

Fracking Affects Indiana Gasoline Prices

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The price of a gallon of gas may be near a record high, but it isn‘t because the U.S. is importing more oil from foreign countries.  Network Indiana’s Ray Steele reports…

 

New technologies, such as hydraulic fracturing – or fracking – have been a boon to domestic oil and natural gas production. Maureen Ferguson, executive director of the Indiana Petroleum Council, says the amount of petroleum products produced in North America that were consumed by the U.S. has grown from 49-percent to 65-percent over the past year. The Department of Energy says U.S. oil production rose 20-percent last year, the biggest increase in 21 years. Other nations who have made billions by selling oil to the U.S. over several decades are taking notice. Oil exports from Africa fell by 41-percent between 2011 and 2012. Ferguson says it‘s also notable that at OPEC‘s annual meeting last week, the group issued a statement saying it would “study” the growth in fracking and other technologies used by U.S. companies. She says OPEC had dismissed fracking as too expensive for years. Ferguson says that if development of known reserves in North America continues, the U.S. could be completely free of OPEC and other foreign sources of liquid petroleum as soon as 2025. Ferguson conceeds that fracking must be conducted in an environmentally sound way, something that many environmental groups believe is impossible. They point to reports of groundwater contamination in some states. Also, some small earthquakes – microquakes – have been linked to deep disposal wells that receive flowback from the water injected into the ground during fracking. A handful of state and local governments as well as some countries in Europe have banned or restricted fracking, but Ferguson says more is known now about safe fracking than just a few years ago. She says if the industry is regulated properly and those regulations are followed, the environment won‘t be harmed.

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