CBO Takes Note of Shale Stimulus

The Congressional Budget Office, which conducts nonpartisan analysis for Congress, released a report this week detailing the impact of the shale energy boom on the American economy.

The report ("The Economic and Budgetary Effects of Producing Oil and Natural Gas From Shale") explains that "the development of shale resources", while "virtually nonexistent a decade ago…has boomed in the United States." Shale resources are now responsible for approximately "3.5 million barrels of tight oil per day and about 9.5 trillion cubic feet (Tcf) of shale gas per year."

According to the CBO, the impact of this increased production on the American economy is monumental. "On net, CBO estimates that real (inflation-adjusted) GDP will be about two-thirds of 1 percent higher in 2020 and about 1 percent higher in 2040 than it would have been without the development of shale resources."

The CBO observed that shale energy has lowered prices for American consumers and found that "shale development has also affected the federal budget, chiefly by increasing tax revenues." The impact of the federal budget is substantial as “CBO estimates that federal tax revenues will be about three-quarters of 1 percent (or about $35 billion) higher in 2020 and about 1 percent higher in 2040 than they would have been without shale development.”

As politicians in Washington fight over various ways to stimulate the economy, shale energy production (in North Texas and other parts of the country) is chugging along, saving consumers money and providing revenue for essential government services.


Read the full CBO report (The Economic and Budgetary Effects of Producing Oil and Natural Gas From Shale):

https://www.cbo.gov/sites/default/files/cbofiles/attachments/49815-Effects_of_Shale_Production.pdf

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