Recently gas prices have dropped roughly 50% in the
past few months. This is a big break for the hard working American, gas going
from around $4.oo to a national average of $2.20 is a big deal. Most people
think that only good can come out of this recent drop in gas prices. In the 2008-09
financial collapse oil prices went from $100 a barrel to $40 a barrel in just a
few months. This is the last time that oil prices have been this low. So this
could be dangerous for our nation’s economy. Also with the drop in oil prices
there has arose another problem in the oil industries, layoffs. Thousands of
workers are being let g because of the drop in oil prices. So there are
positives and negatives to this dramatic drop in oil prices. OPEC is an oil
organization which Saudi Arabia (second largest producer of oil) belongs too
along with several other countries. Oil prices is globally going down in the
past few years the US has been going for hard to get oil and that combined with
OPECs continuation of oil production and Europe and Asia’s decline of oil petroleum
use has caused a price crash. The supply of oil is greater than the demand therefore
resulting in the sudden drop in prices. Usually OPEC would slow down production
balancing out the prices but they are not doing that this time. There are
hoping that this drop in prices will make the newer producers of oil
unprofitable and have to close down leaving them with more control of the oil
industry. If gas stays under $2.50 that will be $1,100 in savings per year for
the average family, this will boost our economy. So for the everyday American this
drop in gas prices is good but could be dangerous because of the possibility of
the financial collapse. For certain oil companies in the US this could not be a
very good situation.
INCOMPLETE :( What is this, only two sentences. Did you forget to finish this? LATE, it will cost you. Hope the opportunity cost was worth it.
ReplyDeleteOk, this was much better. You touched on some points no one else addressed, like OPEC and the competition between their output and the increase output of American oil. The effect on American workers, the lay offs vs. the increase in consumer spending was good. But posting late will cost you.
ReplyDeleteDidn't think of oil companies trying to out-profit their rivals to remain in business and gain more profit than ever before. Was this your thought or someone else's? Good train of thought here.
ReplyDelete