Turmoil in Iraq hiking gas prices, homegrown energy could stabilize it

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EAU CLAIRE, Wis. (WEAU) -- Tensions in Iraq are forcing gas prices to climb in the U.S. On Monday, Al-Qaeda linked militants seized yet another town in Northwest Iraq after vowing last week to take their fight to Baghdad. They won't stop until the government steps down. On top of all this they want to establish an Islamic state across Syria, Iraq and other regions.

According to AAA, it is guaranteed that consumers will pay more at the pump in the coming days due to the violence in Iraq because oil production is predicted to slow down, forcing prices to go up.

The national average for a gallon of gas sits at $3.64. In Eau Claire, the average price for regular gas is $3.69 per gallon. Last month, it was $3.59 and six months ago it was $3.07. AAA said the numbers are likely to climb a few cents more over the next week.

Summertime travelers like Percy Kight who drive from Milwaukee to Eau Claire said it’s no secret gas isn’t cheap.

“Some days, gas prices be kind of lower and cheaper you can bear with it a little easier. And other days you wake up and it’s like almost $4. It's like oh wow, that's a lot of money,” said Kight.

But while the foreign oil industry remains in question, a local financial strategist says the domestic energy boom may be a solution. Ameriprise financial advisor Adam Mohr said there's light at the end of the tunnel, thanks to homegrown energy.

“Within the last 10 years, there's been technology created that has allowed Americans to seek oil whether it be natural gas, crude, in places they never have been able to access before,” said Mohr. “In creating this technology, it's really allowed us to become as of 2012 the world's second largest producer of energy in the world.”

He said it allows the U.S. to rely on itself for oil.

“There's plenty of global turmoil right now, Iraq probably being the hot spot. But the nice thing about stability within the U.S. is that as we ramp up production, it's really offering a buffer in our needs and really supplies demands of global and international oil,” said Mohr.

According to fidelity, the U.S. is on track to be energy independent by 2020 and could start exporting oil by 2030.
It's also expected to create 3.6 million jobs.

“Whether its railroads or small towns that have access to these natural resources, it’s going to continue to help the average Joe out there,” said Mohr.

Homegrown energy is also more cost effective. The Federal Energy Regulatory Commission said the U.S. produces natural gas for about $4 a unit. The U.S.’s closest competitor, Germany produces natural gas at $11 a unit.

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