Posted on 12/01/2018 10:52:43 PM PST by con-surf-ative
The assumption generally held is that lower oil prices generally benefit the US economy. A closer look shows this is not necessarily the case.
(Excerpt) Read more at oilprice.com ...
Good question. Will it lead to $2/gallon gas? Dream on.
I gotta say, when Obummer became president, gasoline was at $1.87 an gallon.
low oil prices will allow the government to sneak in additional taxes.
Taxes should be removed.
Hurt some in the US, help most.
Yeah, and a nice lunch (deli sandwich, side order, and a soft drink) cost $5.
When he left office, such a lunch cost $10.
they help ME....I don’t own oil stocks nor oil wells...we are not rich..not poor either but we definitely like paying less at the pump...
The knee-jerk answer really depends on whether you’re on the supply side or the demand side of the question.
If the price of oil is too low, well, it’ll still be in the ground when the price goes back up. And at some pump price, it will be worth while for suppliers to dive back in.
Even if all the old oilmen die off in the meantime, their grand kids will still be able to Google “How to get crude from the ground and deliver it in useful form to the gas station”
Also, the lower the price of oil, the sooner the Saudis and their ilk will be bankrupted.
It's a win-win.
The argument is beside the point with respect to the context of the situation. Low oil prices are good for an industrialized economy.
A de-industrialized economy is an economy that will collapse due to balance of payments deficits in trade, rising debts, eventually skyrocketing interest rates, bond collapse, etc.
Let’s get industrialized again (MAGA), and produce for low (but profitable enough) oil prices.
Lower oil prices hurt the oil companies and benefit just about everyone other than the oil companies. Remember when oil prices were low and JR Euwing was fretting about what to do? Maybe an act of Congress to Get JR back on his feet financially?
hmmm...
let me see.
gas hit $4 back in 07, economy tanked.
Gas is around $2 now at many stations in the less corrupt states.
Who shot J.R.?
https://en.wikipedia.org/wiki/Who_shot_J.R.%3F
Where do these idiots come from? Of course lower prices for gasoline help the economy. People have money to spend on other things.
Nope. Voters allow government to sneak in additional taxes.
There is a happy zone around $50-60 dollar oil. Enough to keep the oil industry well lubricated, but still relatively cheap gas. The bottleneck in refineries also drives the gas price. That is the next place to work on.
The answer is both. Falling gas prices benefit the consumer, and the consumer is widely considered to be about 2/3 of the United States economy. So low gas prices produce higher consumer spending....that’s an important point because the consumer, like it or not, is simply an enormous part of the US economy. On the other hand falling gas prices generate a certain amount of nervousness in the bond markets, because with the rise in oil prices, people have been encouraged to get more leveraged in the oil space and there is a great deal of secondary debt in that market that needs higher oil prices to service. So lower prices in oil affect that market a great deal. And that is a very important Market.
Finally, in the stock market, lower oil prices depress the stock prices of oil companies like Exxon and Conoco, but Airlines have been ramping considerably. This also affects the Dow Jones Transportation average which a lot of people use as a clue for the economy. So in sum it’s probably beneficial to have lower oil prices, to a certain extent... until they get so low that the secondary bond market blows up. That would not be good.
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