Posted on 02/25/2022 6:15:01 AM PST by Diana in Wisconsin
Russia’s invasion of Ukraine has sent oil futures above $100 a barrel for the first time since 2014 and will probably bring $4-a-gallon gasoline to much of the United States. But it won’t be a major drag on US economic growth.
Economists project that at most the nation’s gross domestic product, the broadest measure of its economic activity, will have a few tenths of a percentage point shaved off its growth rate. With the economy growing very strong — GDP had its best growth since 1984 last year — America is expected to weather those higher prices just fine, even if drivers are grumbling.
*SNIP*
“While we know it will definitely mean a reduction for the real spending by households [on other goods], there will be a positive impact on domestic oil production,” Ashworth said. But he said that the run up in oil prices the last two years has done less than might be expected to raise oil production, investment spending and hiring by US oil companies. That’s partly because investors and banks have been reluctant to pour more money into fossil fuel companies.
“We’ve already had oil go from $40 a barrel to $90 with a lackluster response by shale producers,” Ashworth said. “So I expect the positive impact on production will be less than the negative on other household spending.
Goldman Sachs also expects only a modest impact on economic growth from the oil price spike — equal to about one-tenth of a percentage point of growth for every $10 rise in the price of an oil barrel.
The spike and the fighting in Ukraine could kill the talk of the Federal Reserve raising interest rates by a half percentage point at its next meeting, rather than the traditional quarter-percentage-point rise.
(Excerpt) Read more at channel3000.com ...
"The Fed’s Geopolitical Risk Index is at the highest point since the Iraq War in 2003. If the Fed is more cautious on raising rates, that could cushion the blow that higher oil and gas prices might have on growth."
Lol…$4 gas by itself won’t but inflation, printing of money, more fees, higher taxes, higher cost of everything sure is!!! My goodness, we would never see articles like this if it were Trump in charge.
Complete idiocy.
It could be $55 oil in 3 weeks, if Bidet weren’t so stubborn and ignorant.
Those of us driving Hyundai Accents will barely notice the difference.
Two refineries in the south have fires and shut down. Gulf crude oil production in the gulf has been shut down for a storm I read. Middle East has at least one refinery on fire. Several oil pipelines are out of service. I think things may double again.
“The most recent bout of $100 oil before this one started in July 2013, and oil prices stayed near or above that mark for a bit more than a year. But the nation avoided a recession then as well. GDP did turn negative in the first quarter of 2014, but that was attributed to many other factors, including particularly bad winter weather that kept many consumers at home. And the economy bounced back strong in the second quarter of 2014, even though oil prices didn’t fall below $100 for good until the end of July.”
I remember that! My Boss at the time - WHO HAD VOTED FOR THIS, TWICE! - was crying because she was losing so much of her hard-won retirement dollars. And it got continually WORSE under 0bama/Biden!
*SNORT*
It is more than $5.00 in Ca. right now!!
All the same prognostications for the same suckups that said inflation would be around 2-3% this year. Who listens to these idiots.
Is that today’s equivalent of the Pacer? LOL!
Filled up my tank yesterday - over $50.
This is California with prices already around $4.79/gallon and many people commuting long distances to work.
The price of groceries has soared.
How is the average working family expected to "weather" this?
Any complaints I hear I ask: "Who did you vote for?"
Biden/Newsom voters are the ones that deserve this, hard, not the rest of us.
Don’t fret, it’s transitory misery…
How do you define “taking us down?”
They are accepting of lower labor participation rates, low net growth in GDP (inflation adjusted), no true increase in labor productivity...
Their ideology lets them accept that because some social egalitarian philosophy (racial, sexual, sexual orientation), some liberal environmentalist scheme (which is really just a way to tax and redistribute wealth - so they can redefine the economy), takes precedence.
What utter BS! $4-a-gallon will hurt EVERY American. The poor, including many blacks, who have to drive old Buicks will be hit hardest.
Homosexuals?…
Yes, two weeks to flatten the misery.
The title is 100% accurate. It’s already derailed.
It mattered to me when I was filling up every two days for my 150 mile round trip commute. I’m retired now. Sure, it will impact the cost of everything I buy, but I don’t buy much any more. And at least it doesn’t affect me DIRECTLY like it did.
But I leave the fight to those that are directly affected.
It’s $2.90 here in central Kentucky right now. It’s time to fill up my 250 gallon tank by the barn...
More Happy talk from the propaganda ministry.
“Inflation Good !”
“$6.50 a Gallon Gas Good !”
“Rampant Crime and Murder Good !”
“Biden is the Best president in History!”
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