The Impact of the Shale Oil Revolution on U.S. Oil and Gasoline Prices
By Lutz Kilian. Review of Environmental Economics and Policy, 2016
246 citations recorded by the source corpus.
This article examines how the shale oil revolution has shaped the evolution of U.S. crude oil and gasoline prices. It puts the increased production of shale oil into historical perspective, highlights uncertainties about future shale oil production, and cautions against the view that the United States will become the next Saudi Arabia. It then reviews how the ban on U.S. crude oil exports, capacity constraints in refining and transporting crude oil, and the regional fragmentation of the global market for crude oil after 2010 have affected U.S. oil and gasoline prices. In particular, the article discusses the reasons for the persistent wedge between U.S. and global crude oil prices in recent years, explains why domestic oil trading at a discount has not lowered U.S. gasoline prices, and discusses the role of shale oil in causing the 2014 oil price decline. Finally, the article explores the implications of the shale oil revolution for the U.S. economy and explains why increased shale oil production is unlikely to create a boom in oil-intensive U.S. manufacturing industries.
Subfields: Economics and Econometrics, Renewable Energy, Sustainability and the Environment
View Paper: https://www.semanticscholar.org/paper/35faeb633ee5324ed59941c85229a65107acfafa
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In Economics and Econometrics
- Christiane Baumeister
- Lutz Kilian
- George Filis
- Stavros Degiannakis *
- Robert J. Vigfusson
- Rangan Gupta
- Ronald A. Ratti
- G. Peersman
In Renewable Energy, Sustainability and the Environment
- Christiane Baumeister
- Lutz Kilian
- George Filis
- Stavros Degiannakis *
- Robert J. Vigfusson
- Ronald A. Ratti
- G. Peersman
- Matteo Manera
Citations in the corpus
- Oil price elasticities and oil price fluctuations (2016, unknown): “Through the lens of the model, the sharp contraction in 27Baumeister and Kilian (2016a) attribute a large portion of the slide to reduced demand for oil, arguably caused by the Asian financial crisis, which was followed by economic crises in other countries including Russia, Brazil, and Argentina.”
- The Impact of the Fracking Boom on Arab Oil Producers (2016, methodology): “The estimates confirm that all three shocks contributed to the decline in the real price of oil since June 2014 rather than the oil supply shock alone, which is broadly consistent with the conclusions of Baumeister and Kilian (2016b) using an alternative methodology.”
- Geotechnical engineering behaviors of gellan gum biopolymer treated sand (2016, background): “Generally, gasoline has an energy density of 46.4 MJ/kg (Nakićenović et al. 1998), and thus, the average fuel cost to treat 1 t of soil with thermogelated gellan gum treatment becomes approximately 9.63 US$/t, considering the average market price of gasoline in the U.S. in 2014 (Kilian 2014).”
- Understanding the Decline in the Price of Oil since June 2014 (2015, unknown): “Baumeister and Kilian (2014a) recently showed that there is a similar business-cycle driven component also in 5 the price of food commodities.”
- Understanding the Decline in the Price of Oil since June 2014 (2016, background): “The bar chart provides evidence of a weakening global economy, especially in the first half of 2014, with some recovery in the second half, as the price of oil declined, followed by a sharp deterioration in global real activity in December 2014.”