This Article is About
gas prices
price of crude oil
price of gasoline
political turmoil
industry insiders
business growth
nervousness
negative impact
Are Gas Prices Going To Drop In Time For The Summer Driving Season Or Not?
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According to industry reports, gas prices across the United States rose for a period of forty four straight days, a horrifying trend that continued until Friday. For the first time in over a month, gas prices fell by a fraction of a cent, not enough to be noticed by consumers, but apparently enough to cause some industry insiders and economists to become cautiously excited. The two expert groups, however, were quick to point out that it may be far too soon in the season to say that gas prices have peaked.

Gas prices that consumers see at the pumps depend on a number of factors, which include not only the cost per barrel of crude oil, but also the economy both here and worldwide, amongst other things. Chris Christopher, a Senior Economist at IHS Global Insight, has pointed out that the price of crude oil declined sharply in the previous week but also reminded consumers that it usually takes two weeks for the price of gasoline to catch up to the change in the price of crude oil.

Economists suggest that a potential problem with the economy, described as a “soft patch” may be the cause, at least in part, of the high gas prices, but that these prices may also be to blame for that economic slowing. The higher gas prices climb, the less people will drive, even during the peak driving season, which typically begins after Memorial Day and continues until Labor Day. With less people driving there is less spending going on which tends to make business owners nervous. That nervousness tends to translate to hiring freezes and slowed business growth, which ironically has a negative impact on the economy.

In addition to the price of crude oil, economists are looking to the political turmoil in the Middle East, concerned that increased tensions there could mean less available crude oil on the open market. In the US, many domestic gas refineries shut down for the warmer months for both maintenance and to switch over their techniques to prepare for the cleaner blends that are typically used for summer months.

Gas prices have hovered at or slightly above $4 a gallon for nearly a month now, which will impact the economy not only in direct relation to driving, but also to the ancillary services that rely on summer travelers across the country. If the prices have not peaked at this point, the speculators are drawing their numbers for exactly how high gas prices can possibly climb and what impact that will have on the struggling economy.

Unfortunately, the gas prices have also been a source of political wrangling and finger pointing, with major parties blaming each other for the skyrocketing prices and the economic uncertainty that it has caused. Suggestions for how to fix the problem have been bandied about, but nothing concrete has arisen from these to date.


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