SPRINGFIELD, Mass. (WWLP) – It was a gift that kept on giving for consumers… an increase in oil supply… and a continued low demand… resulting in cheap prices at the gas pump.
“I run a small business. It affects me tremendously. I put about 45,000 miles a year on my car. Last year alone I spent more than $15,000 on gas,” said Ernest Verni.
However, it seems the savings slide may have bottomed out. The U.S. benchmark price for oil fell from about $110 a barrel last summer to below $45 a barrel this year. Prices stabilized slightly over the last few days, but economists are predicting even more of a recovery, which means it’ll cost you more to fill your tank.
Financial analyst Tim Suffish told 22News he thinks a return to the levels we saw last year is years away thanks to new technology in fracking and horizontal drilling. “Those are techniques that allow the oil industry to go into old wells that were considered dead and not opportunistic to drill, but with these new techniques they were able to get oil out of those wells,” Suffish said.
Wells in places like North Dakota and Texas. According to the US Energy Information Administration, the United States can produce more oil than it imports for the first time in 20 years, making it less reliant on the other top producers: Saudi Arabia, Russia, China, and Canada.