Hydraulic fracturing generated $3.5 trillion in new wealth between 2012 and 2014 in spite of falling oil prices, according to a new study, but today’s rising prices could be even better for the U.S. economy.
From 2012 to 2014, the shale oil industry generated 4.6 million new jobs due to an energy boom and the resulting low gas prices, according to a study published by the National Bureau of Economic Research (NBER). Expensive energy could be a huge net positive for the U.S. fracking economy because rising oil prices mean more drilling.
Oil prices fell to a record low of $30 a barrel during the previous year, sharply reducing the industry’s profit margins, which are now rising again. Researchers estimate that new economic activity from fracking technology created around 4.6 million net new jobs, but only about 1.6 million of these new jobs were directly linked to the oil industry, while many of the rest were due to lower gas prices and the positive effect that had on the American economy.
“What’s often overlooked is the impact that the shale revolution has had throughout the economy,” Chris Warren, a spokesperson for the pro-industry Institute for Energy Research (IER), told The Daily Caller News Foundation. “Lower energy prices mean people have more money to save or spend on other day-to-day necessities. More energy production leads to job creation in other sectors of the economy, whether it’s manufacturing, healthcare, education, etc.”