CEA Warns Policymakers: U.S. Energy Production Mitigates Global Instability, Helps Transportation Consumers
August 15 2018 - 8:45AM
Business Wire
“Fueling America’s Energy Consumers” Report
Details Importance of Energy to Transportation and How a Lack of
Consistent Energy Supply Will Increase Prices, Hurt Families and
Small Businesses
In a new report released today by Consumer Energy Alliance
(CEA), the organization warns policymakers that recent geopolitical
turmoil and global oil price instability could negatively affect
U.S. consumers and one of the largest energy consuming industries
in the United States, the transportation sector. Geopolitical
events continue to directly affect global energy markets and will
continue to do so in the U.S. if oil is transported into the
country from foreign nations.
The report, titled “Fueling America’s Energy Consumers,”
examines how fuel price increases negatively affect American
consumers and their ability to work, travel, buy affordable
products and pay their bills. High transportation costs also
hurt American businesses by increasing their operational expenses
and overhead – costs which are often passed on to the consumer
through price increases.
The chief mitigating factor helping U.S. families is the
on-going U.S. Energy Revolution and the impact it has on helping to
maintain lower prices for U.S. consumers.
While fluctuations in global energy markets are part of the
problem, CEA believes that policymakers should continue to consider
American energy resources as the solution. Currently, the United
States has large amounts of oil and natural gas resources on
federal lands onshore and offshore, as well as technologically
feasible renewable energy solutions. These resources can be
developed safely, efficiently and responsibly, with great care
taken to protect the environment.
Highlights from the report include:
- Transportation sector is the largest
energy-consuming segment in the U.S., accounting for nearly 30
percent of the nation’s energy use in 2017. In 2017, oil and
natural gas provided approximately 92 percent of the total energy
used to power these modes of transportation.
- U.S. is still importing crude oil and
petroleum products from other nations to meet demand. In 2017, the
U.S. imported a little more than 10 million barrels of crude oil
and petroleum products per day.
- In 2017, the average American household
spent around $1,765 on gasoline. In 2018, the cost of gasoline is
expected to increase by $133 per household – setting families back
nearly $1,900. The U.S. is expected to spend nearly $365 million on
gasoline in 2018 – an increase of more than $60 million since
2016.
- More than 3.6 million heavy-duty trucks
are needed to move the 10.5 billion tons of freight transported
across the nation on an annual basis. Moving that freight requires
more than 15 billion gallons of gasoline and nearly 39 billion
gallons of diesel fuel every year. In 2015, the trucking industry
paid more than $105 billion for diesel fuel.
- Approximately 50 to 60 percent of a
vessel’s expenses are allocated for fuel costs. A typical
Trans-Pacific cargo carrier can expect a fuel bill of over $3.3
million for a 28-day voyage. With the expansion of global markets,
the use of cargo ships will continue.
- A one-cent increase in the average
price of diesel fuel can add another $350-$370 million per year in
fuel costs for the shipping industry – costs which are felt across
the supply chain.
- The price of jet fuel has increased
over 58 percent from June 2017 to June 2018. For every
dollar-per-barrel increase in the cost of oil, the airline
industry’s fuel bill goes up by $420 million.
“This report highlights the often-overlooked fact that oil and
natural gas provide the majority of energy used in the
transportation sector, and when the price of oil rises due to
external factors like supply disruptions and geopolitical events,
that means the price of transportation fuels also rises,” CEA
President David Holt said. “While the United States has been
undergoing an energy revolution over the last decade, keeping
prices much lower than they would otherwise be, it is still
importing a fair amount of crude oil and petroleum products from
other nations – making it reliant on imported oil to ensure
American consumers and businesses meet their transportation
needs.”
Holt added, “Americans have witnessed this firsthand during this
summer’s hot vacation months, with the cost to fill up pinching not
only consumers’ wallets at the pump, but also in the air as
airlines adjust for the rising cost of jet fuel through higher
airfare. For most of these families, reducing the amount they spend
on gasoline is not an option. All too often, this usually means
choosing between filling up on gasoline for work and other
day-to-day commutes or paying for household essentials, such as
groceries or rent.”
“Everyone from working mothers trying to pay their bills to
small retailers who spend a large percentage of their revenue on
fuel costs must have a stake in making sure we meet our energy
needs, and it needs to be a top priority for our policymakers to
ensure we do,” Holt continued. “Any policy that helps directly
expand U.S. energy development and provides environmental
protection is good for American families and businesses. By
continuing to support sensible energy policies that responsibly
utilize our abundant and affordable domestic energy resources, we
can provide further relief to American families and
businesses.”
To view the report, click here.
About Consumer Energy Alliance
Consumer Energy Alliance (CEA) brings together families,
farmers, small businesses, distributors, producers and
manufacturers to support America's energy future. With more than
500,000 members nationwide, our mission is to help ensure stable
prices and energy security for households across the country. We
believe energy development is something that touches everyone in
our nation, and thus it is necessary for all of us to actively
engage in the conversation about how we develop our diverse energy
resources and energy's importance to the economy. Learn more at
ConsumerEnergyAlliance.org.
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Consumer Energy AllianceEmily Haggstrom,
720-582-0242ehaggstrom@consumerenergyalliance.org