Fuel Crisis and Economic Crisis Linked Globally
It seems like just a few weeks ago there was loud groaning about how high fuel prices had gotten and how there was no end in sight. Everyone from the public to lawmakers to economists was worried and even panicking.
Here we are a few weeks later and the situation has been going the opposite way. The predictions were that the price of fuel would continue to rise as economic woes continued to get worse. While forecasters were fanning the flames of fear, economists and others started warning that the fuel crisis and the economic crisis are linked – not just locally – but also globally.
The issue now is that with stocks tumbling, real estate and mortgages falling apart and banks having to be rescued on a daily basis, it is impossible for oil prices to be separated out of the mix.
In the past week alone, the cost of crude per barrel has fallen over $6.00, to under $87.00. In a period when gasoline was up over $4 per gallon a month or so ago with dire predictions about $5, $6, or $7 per gallon or higher being tossed about, it has been interesting to see how fast the price per gallon has plummeted to below $3.50 per gallon, and even more interesting that the predictions are that the price per gallon of regular gasoline will be less than $3 by the end of the next 30 days.
Some of the forecasters that have long term foresight have been issuing strong warnings that as the stock market and the economy get worse; the price of gas would go down. People would not be able to afford to purchase it at the high prices during a severe economic downturn. When the stock market is as volatile as it has been recently dropping between 500 and 800 points in one session and affecting global markets, there are definitely economic repercussions. Europe is experiencing worry, fear and panic by its citizens because of the far-reaching effects of the economic problems.
Some of the only folks who might be experiencing a little extra relief are the auto dealers who sell large cars and trucks – and who have plenty sitting around because fuel was too high for people to purchase – or those who own large cars or trucks and were really feeling the pinch at the pump more than those with economical cars.
We are not out of the woods yet, and the economic and fuel crisis is not as simple as it may seem. For now, we may be getting a break on gasoline, but keep your eyes peeled – there is more to this roller coaster ride than meets the eye.