Prices for natural gas, which fuels everything from furnaces to power plants to cars, are falling. But the tide may be turning, with industry watchers seeing prospects for the clean-burning fuel starting to improve in the second half of the year.
Brent oil fell nearly 4 percent on Thursday after a preliminary pact between Iran and global powers on Tehran’s nuclear program, even as officials set further talks in June and analysts questioned when the OPEC member will be allowed to export more crude.
Hydraulic fracturing has unleashed vast new quantities of crude oil and natural gas. The percentage of fuel flowing from shale-rock compared with traditional oil and gas fields has been steadily rising. But lackluster energy demand and low prices are expected to curb growth later this year. Here’s a graphic that helps explain fracking.
Aaron Walsh’s first car was a 2008 Chrysler Sebring flex-fuel, meaning it could take E85 or any other ethanol blend. It was a good car.
But his new car … wow. The 2012 Dodge Charger, in Tungsten Metallic gray. Now that’s a proper car for a young man. And Walsh never would have bought it if it didn’t come in a flex-fuel version.
“That’s my biggest reason for using it,” says the student from Haslett, Mich., just east of Lansing. “I absolutely hate the petroleum industry.”
His reasons are mostly environmental: the BP spill in the Gulf, etc. “I could go into it, but it would take a long time.”
The point is, he did something about it, and that something came around the time he decided he needed a vehicle upgrade. Walsh already knew the benefits of ethanol because of his father, who works for the state of Michigan, which encourages state employees to put E85 into their flex-fuel vehicles. So right around his 21st birthday, last June, he found the Charger and its 3.6-liter Pentastar V6 engine.
“I wanted something that didn’t have to run on gasoline,” he said. “And the first thing I wanted was an electric; I was really into the Chevy Volt. But then I realized a college student doesn’t have $40,000. Then I looked and saw that the Charger is $24,000.”
Walsh, who attends Lansing Community College, says finding an E85 station isn’t difficult. “It keeps getting easier and easier,” he says. He posts his fill-up data to his Twitter feed, @gasisoutrageous (his account name is #Number1BigHero6Fan … hey, dude has other interests besides ethanol), and he regularly gets in the twenties for mpg. Also, E85 is a lot cheaper than regular gasoline at many stations in the Lansing-Haslett area. Nationally, E85 was only $1.86 a gallon Thursday, 23.7 percent cheaper than E10, according to E85Prices.com.
Price isn’t the only benefit to buying E85. Higher ethanol blends burn more cleanly and efficiently than E10 (what most of us call regular gas). Using more alcohol fuels displaces oil, strengthening the overall U.S. economy, creating domestic jobs; reducing oil consumption is better for our air, water and health.
But the price at the pump is still a big factor, and most Americans know this. Walsh knows it, and needs it. He works at a convenience store, and says his dad has been helping him out covering the cost of payments and upkeep. The vehicle is also not exactly ideal for the brutal Michigan winters, with is rear-wheel and slick tires.
But he loves it. Using ethanol doesn’t mean you can’t enjoy your car at the same time. And that roaring engine runs great on high-octane E85.
“When I started driving, whenever I would slam on the accelerator pedal, I’d just hear dollar signs. Now I like the performance. I actually bought that car just because of the engine.”
Other posts in our “Share Your Story” series:
It looks like presidential hopeful Rand Paul has found a clever way to champion ethanol, with an issue that’s in harmony with his keep-government-out-of-the-marketplace mentality.
Last week we shared stories from people whose quality of life has been affected by the unpredictable ebb and flow of gasoline prices. Visit our Facebook page and read the great discussion riffing on our last post, about Troy Harper in Missouri, to get an idea of how hot-button an issue this has become.
Today we’re passing along sentiments about the work Americans do and how the cost of fuel makes that tougher.
Some workers get paid by the hour, others are salaried, and still others are in business for themselves. Gas prices take a bite every time.
Here are a few of the responses we’ve received:
“I have to work one and half days just to fill my car, just to get to my job. That’s what I spend a week. If they raise gas prices, they should be raising the salaries.”
— Jose G., Streamwood, Illinois
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“My wife and I both work at different times of the day, so we can’t carpool, and driving two cars every day gets too costly, at $3 to $4 a gallon. Not only us, but everybody that has to work has to give up something in order to make ends meet.”
— James
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“As a business owner (lawn maintenance), even a few cents per gallon makes a big difference in my profit margin. My company uses approximately 100 to 130 gallons per week, sometimes more. So the cost of fuel has a large bearing on our workload. Lower prices would really help our bottom line.”
— Keith M., Boca Raton, Florida
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“Gas prices affect me and my job, where most of my profits go toward fuel prices, [since] I’m on the road most of my time. Please lower the gas prices so we can get more out of our earnings, to spend more on family needs. There is no reason to have such high gas prices.”
— Frank C., Rancho Cucamonga, California
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“I am a self-employed courier. I work only part-time now, but the price of fuel for my car has a big impact on my business. You just don’t make as much. With high fuel, prices everything goes up in America. Were are an economy on wheels, as you can tell with all the over-the-road trucks out there today. Fuel affects almost everything and makes it much more difficult to earn a living.”
— Flip P., York, Pennsylvania
Related posts:
Recently we started asking Americans to share their stories about the true cost of unpredictable gas prices. We got an earful.
But out of all the dozens of submissions we received — some only a sentence, others full-on essays — perhaps no one expressed that collective frustration better than Troy Harper of Independence, Missouri.
Here’s what he wrote:
“I used to have a pickup truck [a green 1981 Ford F-series Explorer] with dual tanks. I could usually fill it up for about 30 bucks. That was back when I was in my early 20s, somewhere in 1993 or ‘94. I can remember complaining about the gas prices then. Oh, if only could only go back and warn myself about what was gonna take place in my future, I’d sink every penny I had into crude oil. Because from there on, fuel prices continually increased! Before long it was 3 bucks a gallon and beyond that. It never hit $4 a gallon for regular, but if you wanted mid-grade or super-clean, you were basically paying in blood.
“I got married and had a family, 1996-’97. We had two kids about four years apart. I worked a full-time job had to get a car in order to get around and get back and forth to work. We went on vacations and went to see our families and camped out and went fishing and to the drive-in theater all the time, when we could. But as fuel prices got higher and higher, those trips became fewer and fewer. With the price of fuel rising, the price of everything else rises: food, clothing, household necessities, everything.
“I drove a truck for a produce company [Original DeFeo Produce], locally … I delivered fruits and vegetables to grocery stores and restaurants. Diesel prices were ridiculous. The prices of our products were forever increasing, a fuel surcharge was eventually imposed on our customers, just to cover fuel prices. At almost 5 bucks a gallon it was becoming a huge problem. Our customers’ businesses were seeing less and less business, yet the prices kept increasing. I watched several of these businesses eventually close their doors for good. Even the company I was working for went out of business in March of 2013. It had been in business in downtown Kansas City, Missouri, for over a hundred years. It was family owned and had thrived for a long time, but with the economy bottoming out and our customers closing, it was inevitable. I like to believe that fuel prices played a major role in that factor. As it did in all our lives.
“Currently, the prices have been relatively cheaper. As of today, at a Shell station I saw it for $2.20 a gallon in Independence, Missouri. That’s much better, but I don’t know how long those prices will last.”
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To learn what you can do about volatile gasoline prices, check out our Take Action page. Among the list of choices, watch the movie PUMP on DVD, instantly on iTunes or Amazon, or coming to a college
We asked, and you delivered.
At the start of our “Share Your Story” campaign, Fuel Freedom Foundation sent out the call: Tell us how volatile gasoline prices, which peak and plunge without warning or explanation, affect your daily life.
We got dozens of responses, from all age groups and all regions of the country. Here are some of the best:
“I would love cheaper gas prices, because my boyfriend and I share my van, and several days a week, I have to drive him to work, then go back home, run errands, or take kids to school, then go back and get him later. It takes a lot of gas to do that.”
— Eileen N., Selma, N.C.
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“I can’t raise my wage whenever I want. It’s hard to budget when you know they will raise the price every week — just ’cause they can, I guess.”
— Tim H., Coldwater, Michigan
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“Fuel prices are the only thing in my budget that I can’t consistently account for … it’s infuriating.”
— Manny L., Daly City, California
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“My new granddaughter lives in Odessa, and I can’t afford to take my medications AND go to see her on my fixed income. Groceries and goods are transported to stores by truck, and higher fuel prices are passed on to the consumer by increased food and goods prices. My dollar isn’t worth as much with the higher fuel prices. If gas goes up to $4 a gallon again, I will barely afford food and clothing, much less any traveling to see my granddaughter. Our economy will suffer greatly if fuel prices don’t stabilize around $2 a gallon or less.”
— Gary S., Rowlett, Texas
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“I spend about $300 to $500 a month in fuel. There are some months that we are struggling to pay for food. The trade-off is that the rent is cheaper the further you are from the city, but the gas is killing us.”
— Abe F.
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“I’m on SSDI [Social Security Disability Insurance]. When fuel prices go up or stay high, it’s really simple to explain: I have less food to eat, and I might not be able to buy all my medicine. I have also had to cancel some appointments. Sometimes doctors have to be put off for a later date!”
— Steven D., Des Plaines, Illinois
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“I drive a car with 40 miles to the gallon, and I am still struggling with gas prices. Especially soaring gas prices in Arizona. During the Super Bowl, gas prices dropped to $1.70 a gallon. It was such a stress relief having to pay $15 to fill up my gas tank for the week. But after that week was over, gas prices went up to $2.49 in just a week. It is unfair that big companies do this to people. I can’t even imagine how people live with bigger engines. Having to shovel $80 for a tank that lasts a week.”
— Thomas M., Phoenix
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“Gas prices have kept me from seeing my brother, who is 75 years old and lives 240 miles from me. He won’t be around forever, but the jerks screwing us with high gas prices will. I hope they someday get judged on making travel for the retired so hard. They need to lose all their money and see what it’s like.”
— Calvin
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We’ll be posting more responses over the next week or so. If you’re wondering what you can do about the unending rollercoaster of oil and gas prices, there’s plenty, so visit our Take Action page, where you can learn more about our mission to reduce oil consumption. You can sign our petition asking major fueling retailers, like Costco, to offer consumers alternative fuels.
Also, check out our companion site, which is all about the stupendously great documentary film PUMP.
Major oil-and-gas corporation BP announced Monday it is parting ways with the American Legislative Exchange Council, marking just the latest—and likely most significant—departure of a blue-chip company from the conservative group in recent months, National Journal has learned.
Energy entrepreneur Boone Pickens said Thursday he sees $70-a-barrel oil by year’s end, and between $80 and $90 within 12 to 18 months.
