By Don Briggs

President, Louisiana Oil and Gas Association

Driving down the road searching for cheap gasoline can be a touch disheartening. Individuals across the country are feeling the effects of the price ticker at the pump continually climbing. As the country mulls through yet another political campaign season, solutions for bringing gasoline prices down are abundant. Can these Presidential candidates really do anything about the prices or is it nothing more than political rhetoric? The GOP claims it is President Obama’s problem, President Obama blames former President Bush, and the blame game continues. However, many factors play into the high gasoline prices.

The price of crude oil is a leading factor for high gasoline prices. As crude oil is currently trading over $100 per barrel, the US market will naturally fill the increase in pricing at the pump. While the price of crude oil rises and falls over time, the price per gallon of gasoline is estimated to be at nearly four dollars by July 4^th. As with any market, crude oil is a cyclical market that traditionally corrects itself as the summer months close out. While the cause of these cyclical prices is due to the world market demand, the United States helps contribute to the problem by importing around 9 million barrels of crude oil per day.

As the US demand for crude oil increases each year, it appears that the United States will never truly reach energy independence. However, thanks to the new developments surrounding Natural Gas plays in the United States and the advancement in horizontal drilling technology, resource independence can be a potential reality for Americans. As more vehicles each month are introduced that run on compressed natural gas, this will only assist in lowering the demand for crude oil, which in turn could reduce the price of gasoline.

Another influence on gasoline prices is the geo-political unrest in the Middle East. The United States has been in a decade-long conflict with Iraq, Iran is hostile towards Israel, and the list goes on. With the constant threat of these wars and international crises in the Middle East, pain will continually be felt at the pump. Again, whether peace is ever achieved oversees, America will only feel relief surrounding gasoline prices when our own natural resources are used to fuel the country.

Lastly, the value of the US dollar plays a major role in the price of gasoline. As the US dollar becomes less and less valuable, the cost of gasoline seems to grow higher and higher. Since stabilizing the US currency against international currencies is a battle all of its own, first stabilizing the US economy must take place. The oil and gas industry is contributing to economic stability by adding hundreds of thousands of direct and indirect jobs thanks to the massive increase in drilling for newly reachable shale plays. While gasoline prices are a good cause for gloom and despair for pumping patrons, the solution can be achieved by utilizing US-produced natural resources.