Energy Institute Paper Puts U.S. Shale Gas Savings at $4.5 Trillion Since 2007
Updated
Updated · Energy Institute Blog · May 11
Energy Institute Paper Puts U.S. Shale Gas Savings at $4.5 Trillion Since 2007
1 articles · Updated · Energy Institute Blog · May 11
$4.5 trillion to $5.3 trillion in cumulative savings since 2007 is the headline estimate in a new Energy Institute working paper on U.S. shale gas, equal to roughly $237 billion to $276 billion a year.
About $3 per Mcf U.S. gas prices have held near, even as war in Iran and attacks on LNG infrastructure pushed global LNG prices sharply higher; Europe and Japan now pay about six times as much.
Shale-driven production growth explains the gap: U.S. gas output has roughly doubled since the late 2000s, turning the country from an LNG importer into the world's largest exporter with 9 billion Mcf of exports last year.
Every month from 2007 to 2025, U.S. gas traded at or below Europe and Japan, averaging $9 per Mcf below Europe and $11 below Japan because transport and LNG export constraints prevent full price equalization.
The paper says 39% of the savings went to electric power customers, but notes the estimate depends on a strong counterfactual and excludes environmental costs and benefits.
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The Trillion-Dollar Shale Revolution: How U.S. Natural Gas Transformed the Economy, Energy Markets, and Global Policy
Overview
The extensive development of U.S. shale gas has brought substantial economic benefits, leading to significant cost savings for American households and businesses. This has resulted in reduced prices for consumers nationwide, as natural gas plays a key role in many production processes. The ripple effects of shale production are expected to continue, with forecasts of ongoing declines in electricity costs as more natural gas power plants are built. These trends mean that every person in the U.S. benefits from lower prices, putting more money into Americans' pockets for years to come.