Identifying Key Economic Impacts of Recent Increases in U.S. Natural Gas Production (May 22, 2012)
During the past five years, U.S. natural gas supply increased quickly and dramatically as shale gas production increased. Expectations of constrained gas supplies were confounded, and prices reacted accordingly:
- wholesale gas prices fell 55 percent in one year; and,
- retail prices fell about $4 per MMBtu.
These lower prices were passed directly to natural gas consumers:
- 2010 gas bills were more than $175 lower for the average residential customer and more than $1,100 lower for the typical commercial customer compared to what the bills would have been using 2008 prices; and,
- When all gas consumers are included, these savings totaled about $250 billion.
Lower natural gas prices have also helped create jobs during one of the worst recessions on record:
- Job creation directly tied to energy extraction and delivery accounted for about 150,000 new jobs in 2011; and,
- Expansion of natural gas-dependent industries could lead to an additional one million manufacturing jobs by 2025.