So, a couple of weeks ago the Associated Press reported on its own special investigation into whether increased domestic oil exploration and development – supply – has any effect on gasoline prices. AP’s conclusion: There’s no correlation and so more U.S. drilling won’t help.

Since gasoline pricing is more complex than that (see our new website), the more apt question is whether supply can affect the cost of crude oil, which accounts for 76 percent of the price we pay at the pump. It’s elementary: Increase supply and you can put downward pressure on the cost of crude, which is the fundamental driver of pump prices.

That’s what we’ve emphasized in posts on AP’s study here and here. Worth repeating is the review of AP’s report by the Marshall Institute’s William O’Keefe, who noted conf... more »

Is President Obama the “anti-energy” president, as former Gov. Pete Du Pont argues in an op-ed piece for the Wall Street Journal (sub. required)? Certainly, in the areas that matter most – oil and natural gas development – a case can be made from the infographic below that the president’s policies haven’t helped.

Administration Oil Strategy Contributes to Price Increases

By “matters most” we mean the sources that current supply more than 60 percent of the energy we use – and which will continue to supply nearly 60 percent of the energy we use for the next quarter century, according to the Energy Information Administration.

That’s not knocking other energy forms, because we need them all. It’s recognizing this energy reality: Our economy runs on oil and natural gas – and will contin... more »

Normally, we don’t bother with blog posts from the Center for American Progress on oil issues because, to borrow from an old saying, there’s no point in fact-checking someone who puts out propaganda by the barrel.  But since this post yesterday sought to “debunk” our “claims,” let’s have a look at CAP’s. Warning: These point/counterpoint, counter/counterpoint things can get a little long.

From CAP:

CLAIM: “More domestic production is critical to putting downward pressure on gasoline prices — supply matters.” – Jack Gerard, American Petroleum Institute President and CEO, March 26, 2012

TRUTH: To test whether more U.S. domestic production would lower gasoline prices, the Associated Press just completed an exhaustive analysis of 36 years of monthly U.S. oil production and gasolin... more »

The Marshall Institute’s William O’Keefe has a must-read on Fuel Fix for folks puzzled by the recent AP analysis that discounted the effect of domestic drilling on global crude pricing, which is the key component (76 percent) in fuel costs.

Remember, the AP said its statistical analysis of 36 years of monthly, inflation-adjusted, gasoline prices found no correlation between the level of production from U.S. wells and prices at the pump.

O’Keefe:

“The AP attempts to use a disconnected statistic, domestic production, to make an erroneous correlation to counter arguments in favor of more U.S. exploration and development. In doing so, the wire service offers the public a political statement in place of objective analysis.”

O’Keefe continues:

“To begin with, domestic oil prod... more »

Earlier this week, API hosted a conference call with bloggers to discuss rising gasoline prices and to correct misinformation about the factors that figure into the prices Americans pay at the pump. API Chief Economist John Felmy explained that crude oil costs account for 76 percent of the prices Americans pay for gasoline. Although crude oil is a global commodity, Felmy said that the United States is not powerless in dealing with global markets because, in fact, “we’re energy rich and have lots of options.”

In his opening statement, Felmy called for the United States to help put downward pressure on fuel price:

“America’s oil and natural gas companies believe a preemptive surrender to the global marketplace and world events is absolutely the wrong policy…Although the president re... more »