Midwest Enjoying Lower Gas Prices Thanks to Canadian Tar Sands Oil
Living in New York City and not owning a car I admit I don't directly notice price rises on gasoline, but traveling around the country you can't help but notice that fuel prices and changes in the them vary pretty widely. A new piece from NPR--whose funding is threatened with being fully eliminated (again)--explains why as gas prices have increased nearly 60¢ on the east and west coast since September, in the midwest and mountain states they've gone up only about 25¢. The answer is a perennial TreeHugger subject and continued environmental disaster: Alberta's tar sands.
Despite protests from environmentalists, Canada's oil sands business is booming. Much of that crude heads into the U.S. through a network of pipelines. But pipeline construction hasn't kept up and a bottleneck has developed in Cushing, Okla.
"Because there are no pipes going south from Cushing to Houston, the oil backs up there and as inventories build, prices go down," says Philip Verleger, an oil market analyst and professor at the University of Calgary.
That means crude in the middle of the country is selling for about $15 a barrel less than it would on the world market. Verleger says you can see that reflected at gas pumps in the middle of the country.
Next time some politician rails against foreign oil and for more energy independence, remember that the US' number on source of imported oil isn't an Arab state, but Canada. And remember that oil produced from tar sands is far more polluting to both air and water than from conventional oil sources.