oil and our economy

Rachael Morgan
10-17-08

“In the past month, domestic oil demand has fallen to its lowest level since June 1999, at 18.6 million barrels a day, according to the Department of Energy.” As the demand for oil related products decreased, the stock pile of domestic crude-oil rapidly rose higher than expected causing the sudden drop in prices. “Oil prices dropped below $70 a barrel for the first time in 14 months Thursday, Prices have fallen nearly $40 a barrel in just three weeks amid growing signs that demand for energy will slow along with weakening economies around the world. As recently as July, oil hit a record above $147 a barrel.” Some analysts are say that Americans should expect oil prices to continue to drop to new lows, and will continue to do so until the economy has stabilized, which means the demands for oil will increase once again as Americans go back to their stable incomes. “The decline could be a stimulus to the economy as consumers pay less to fill up their tanks. If oil prices stay at present levels, consumers would have $250 billion more, over a year, to save or spend elsewhere, according to Lawrence Goldstein, an energy economist.” Although analysts have continuously said that these low oil prices will in the end be harmful to the economy, now they are saying that it could bust it. With Americans having the extra money from saving at the pump, and things like heating bills this winter. Analysts are saying that with this new found money consumers will put it back into the market and give our country a much needed boost.



http://seattletimes.nwsource.com/html/nationworld/2008277013_oil17.html