To me, that’s bad news.
Encourages purchase of large SUVs
Stock market goes to you know where
To me that’s good news. I’m on a tight budget. And this will help millions of hard-working commuters and people low on the socioeconomic ladder.
Gas will never be below $1/gallon again. Taxes alone are .63/gallon. 37 cents/gallon for production, storage, transport, and retail profit? Nope.
Very clearly both sides of the argument in the 1st 2 posts!
Cheap energy helps low income consumers. It also helps business expand and create jobs where the cheap energy is, as long as they believe it will stay that way a while.
Cheap oil and gas keeps our own US oil industry down. I like putting the screws to OPEC, Russia, Iran and more with stronger oil production in North America. $28 a BBL won’t encourage that.
I’m conflicted about this.
Once the high cost producers are purged from the market, the prices will rise again.
Yeah, when everybody’s traded in their economy cars for huge gas guzzling SUV’s. . . 3 - 4 years from now gas will be back up over $4.00 a gallon again. How many times have we seen this play out over the last 40 years? And then you’ll start seeing those stories on the news, people taking their SUV’s out to the quarry and torching them for the insurance money 'cause they can’t sell them and they can’t afford to put gas in them, who could have EVER seen this coming, yada yada yada. I swear some people have the memory span of a goldfish.
$4 gas would mean $100/bbl oil. That won’t happen in the next few years, we proved that US production will jump at those prices. $50-$60/bbl oil would prevent a lot of US drilling, my guess it’ll slowly rise around that range and stay there for quite a while. The last time this big of a drop happened was in the mid '80s, and prices stayed low for 20 years (price adjusted for inflation, now at about $30/bbl):
@EdFrugal YES!!! Cars last 20 years and oil prices cycles occur about 2 to 3 times during that period. There will be a lot of cheap used pickup trucks on the market when oil prices go up gain and the $10 per barrel Obama tax starts to bite.
Noah also had a hard time telling his neighbors there was a flood coming.
Hmm. Our gas went up 25 cents last week
“Our gas went up 25 cents last week”
Not in my neck of the woods!
Here, it just keeps plummeting, and as of today, regular is down to $1.37 at Costco.
That is both the good news and the bad news.
However, the reality of the situation is that this is a somewhat fleeting situation.
Saudi Arabia is doing whatever it can to make it unprofitable for US shale oil producers to continue their operations, and it appears that the Saudi strategy is working, as North Dakota is now entering an economic recession–unlike most of The US.
Enjoy it while you can guys, because once the crafty Saudis put the screws to US shale oil production, the price will start to creep back up again, and will eventually reach the same levels that we saw a few years ago.
"Our gas went up 25 cents last week"
Not in my neck of the woods!
Same here. Gas prices have been dropping. Some places are now below $1.70/gal. Every time I fill up prices are down.
Gas up 15-20 cents a gallon around here in the past week. Filled up today at 1.49 and it was a 1.29 at the same place this past week.
Another place where I usually buy gas is at 1.43 compared to 1.29 a week ago.
The oil and gas patch is hurting. There’s been thousands of people laid off from their jobs in the oil field around here.
Two years ago one could drive down the highways at night and see a dozen rigs lit up in the distance. Now there are none and oil field service traffic has pretty much disappeared other than tankers making pickups at existing sites.
And those jobs lost are some of the best paying jobs out there. Big impact on stores, restaurants, housing, etc.
And that’s the price of a global market. It’s been happening to other business sectors for decades.
It seems to me that sectarian Muslim politics is the moving force in the slump in oil prices. The Sunnis vs Shia conflict has been moved to a battle of oil tankers in the Straits of Hormuz. And for now Iran and Russia are losing.
Middle East politics isn’t helping, but it’s the huge run up in US oil production that is the cause of the oil price slump.
When the administration opposes fracking and new pipelines and sees the oil industry as an enemy and finds Russia moving into the sectarian conflict in the M-E could it be that collusion with OPEC’s Sunnis benefit the administration and OPEC in the long run? Could the POTUS be more Machiavellion than we ever imagined? Could Kerry be more talented than we ever imagined? The current oil market is certainly benefiting the administration. Of course it could be just dumb luck.
I’m thinking ‘dumb luck’. Here’s how the top 3 compare (I think this also has natural gas liquids included with crude production):
Now the price goes down. Just when I get the digester mounted in the back of the truck ready to produce methane.
Now, what am I going to do with all that horse poop I’ve been collecting all winter.