Natural Gas Prices Create US Economic Tailwind

Natural Gas CostNatural gas is a vital resource for economic growth. According to the US Energy Information Administration, 34% of natural gas is used in the production of electricity and 31% to power industry. The average cost per kWh in the US was 3.2 cents, while in the EU it ranged from 7.4 to 9 cents or nearly 3 times as much, while in Japan it was 17.5 cents: nearly 5.5 times as expensive. When consumers spend less on energy they can use the money saved to buy more stuff, helping the economy grow and raising GDP.  Energy costs are also a major factor in the cost of production, so cheaper energy means either more profit for producers or cheaper prices in the world market. Cheap gas prices in the US, made possible by new drilling techniques and the use of fracking, act as a tailwind for America and the American Economy.

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