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Gas Price Hike Relatively Modest from Iraq Chaos

Gas Price Hike Relatively Modest from Iraq Chaos

The price of gas in San Antonio is jumping due to continued unrest in both Iraq and the Ukraine, but oil industry experts say the real story is the fact that the crippling violence in Iraq, which is the world's eighth largest oil producer, has caused prices to rise so little, 1200 WOAI news reports.

  "These political problems in the Middle East just don't affect global oil markets and the U.S. oil markets nearly to the extent that they did in the past,"  said Bud Weinstein of the McGuire Energy Institute at SMU.

  Triple-A says the average price of gas in San Antonio today is $3.43 a gallon. That's up a nickel from last Friday, and actually down fractionally from the price yesterday.

  This despite the fact that the flow of oil from Russia, which is the largest oil producer in the world, has been disrupted by the unrest in the Ukraine and Iraq is in chaos, with that country's largest oil refinery in the midst of vicious combat.

  Weinstein says the real story is the fact that increased oil production in the U.S. especially in the fracking fields of the Eagle Ford and the Cline Shale, has helped to balance what used to be sometimes violent fluctuations in world oil markets.

  "The big difference is that oil production in the United States has increased almost 100 percent in the last five years," Weinstein told 1200 WOAI news.

  The price of gas today is only six cents higher than it was on June 20 of last year, when Iraq and the Ukraine were relatively quiet.

  "For people who are living on the margins, who are living paycheck to paycheck, if you are paying an extra $10 to $20 to buy gas to get you to work, that is still a real burden," he said.

  Experts say had this unrest happened before the U.S. fracking boom, we would easily be paying $4 a gallon in San Antonio, and prices higher than that would not have been out of the question.

 

 

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