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The severe economic downturn here in the US has lead to all sorts of bad news. Layoffs, business closings, and bailouts dominate the headlines, and good news can be hard to find. One of the only reasons to hold our heads high has been the unprecedented drop in gas prices. The recession has caused a decrease in oil demand, which has lead to fuel costs that dropped from $4.11 per gallon in July to $1.62 today. That's a decrease of almost $2.50 per gallon in only five months.
Tom Kloza, chief oil analyst for Oil Price Information Service, says the meteoric fall of fuel prices has been so dramatic that Americans are now paying $1 billion less per day than they were in July. The extra cash in Americans' pockets is likely helping to avoid an even greater financial calamity, though even a billion a day isn't going to make the recession go away. Still, it's nice that we can go to the gas station without consulting with a financial analyst or raiding the children's college fund.

[Source: Detroit Free Press]

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    • 1 Second Ago
      • 6 Years Ago
      If we want to see the US be less dependent on foreign oil and in addition would love to see global warming slow down by emissing less CO2, people need to - amongst other things - use less oil. The only way is via high oil/ gas price. Why else would the average American consider something else but a Suburban. And why should the Big Three consider building anything else but big and in comparison cheap SUVs and Trucks?
      • 6 Years Ago
      This is a temporary relief, but even now I doubt it's doing much. I think most people are still curbing their spending, especially that which involves the use of credit, and definitely I'm certain they are driving less.

      What's going to happen is that once all the de-leveraging occurs in commodity markets, once the dollar falls a bit more, then price of oil will skyrocket back to $100+ per barrel. The demand is still there - it'll continue to increase and supply isn't getting greater.

      And it won't stop at $100 because no oil company will consider doing any sort of exploration in hard to drill areas, nor investing in new refineries, etc etc for simple reason that they'll be afraid to do so in fear of oil falling again. Which of course means that oil-rich countries are probably loving this because they know that later they'll make all their money back and then some more.
      • 6 Years Ago
      Any economic pick up will lift the price of oil with it, which will kill the economy again. There is a supply crisis here which is being masked by demand destruction. If we can live with a collapsed economy, huge unemployment and lage scale poverty then oil prices will stay low for a while yet. Sadly, low oil prices are a symptom of sickness, not a sign of recovery.
      • 6 Years Ago
      If gas stays cheap the democrats will use that as an excuse to tax it.
      They'll use the economy or 'saving the earth' as an excuse.
      Guaranteed.No doubt in my mind.
      Watch it happen.
        • 6 Years Ago
        If used correctly, taxes can make prices a lot more stable. You just have to cut taxes elsewhere so you're not just overtaxing people. Like if they raise the tax on gas but get rid of a buncha road tolls, and cut the sales taxes to balance them out.
        A flexible gasoline tax that kept gas at like $2.50 a gallon wouldn't be too bad-you'd cut the tax if gas got too high and raise it when it got cheap so people don't flip out when gas gets too expensive.
      • 6 Years Ago
      I know higher prices are coming back but I'm driving a very small car and going back to school ,so, I'm very happy that 5 dollars will get me 1/2 tank. I understand that low prices mean people forget about buying smaller cars and conserving which will start the whole process again, but, I needed this break.
        • 6 Years Ago
        Hah, yeah. Right now $13.50 gets me at LEAST 270 miles.
      • 6 Years Ago
      some where out there the "green people" are plotting ways to increase gas prices to force everyone into their ways........
      • 6 Years Ago
      There is no lead in gasoline anymore so spell "led" right (first sentence) not "lead" the metal or "to lead" the verb.
      • 6 Years Ago
      Lulling petroleum consumers into a false sense of security is stupid.

      We actually pay significant costs for imported oil that DO NOT GET COLLECTED AT THE PUMP. These externalized costs should upset all free-market proponents - after all, the result is a subsidized price for oil.
      Higher Federal income taxes, regardless of how much petrol you choose to use (or deliberately avoid using), are the result. Why shouldn't consumers of a commodity actually pay for what it costs to get it here? If we were forced to pay the full amount, we might, *GASP*, use less of it...


      "The National Defense Council Foundation (NDCF), an Alexandria, Virginia-based research and educational institution has completed its year-long analysis of the 'hidden cost' of imported oil. The NDCF project represents the most comprehensive investigation of the military and economic penalty our undue dependence on imported oil exacts from the U.S. economy. Included in this economic toll are:

      * Almost $49.1 billion in annual defense outlays to maintain the capability to defend the flow of Persian Gulf Oil – the equivalent of adding $1.17 to the price of a gallon of gasoline;
      * The loss of 828,400 jobs in the U.S. economy;
      * The loss of $159.9 billion in GNP annually;
      * The loss of $13.4 billion in federal and state revenues annually;
      * Total economic penalties of from $297.2 to $304.9 billion annually.

      If reflected at the gasoline pump, these 'hidden costs' would raise the price of a gallon of gasoline to over $5.28, a fill-up would be over $105..."
        • 6 Years Ago
        It's reflected in inflation so it's not like anyone is getting a free ride.
        • 6 Years Ago
        God, I wish there were more people as smart as you. Literally no one seems to understand this concept.
      • 6 Years Ago
      For anyone interested, Tom Kloza has a blog that is updated every week or two and it's entirely about the oil industry and crude market. In fact, this story came about from the most recent post on his blog.

      I found his blog during the price run-ups of earlier this year and he gives a lot of background and inside info about why things are going the way they are.

      Here is the link, http://blogs.opisnet.com/
      • 6 Years Ago
      GPS vs. OPEC: A battle that OPEC cannot win.

      You folks are so caught up in prices at the pump, hybrids, and EVs etc. that you've all totally overlooked the single most important player in lowering Americas fuel consumption.

      The GPS unit. I have had my Garmins for 2 years now. Paid $600+ for the first one. Replaced it a year later after it was stolen for half the price.

      The precise directions means I go directly from point A to point B. No more 30 to 45 mins. being lost. That is a 30 to 34 min. savings of fuel. When we are lost is when our cars are operated in the least efficient manner. Think of how you normally drive your car, and think of how frantic you get when you finally admit that you are lost, which usually 10 to 20 mins. after you've missed your turn, exit or on-ramp. Multiply this scenario by the tens of millions of units sold here in the US alone. Remember that these savings occur millions of times every day.

      I estimate a savings of 75 gallons per year, and I mostly only on weekends.

      It doesn't matter what you drive, you can do it more efficiently with a GPS navigation system.

      Yes, American may have changed their driving habits, but the not as much as we seem to think. As more GPS systems are deployed, national fuel consumption will continue to drop. Thanks DARPA (inventors of the GPS network). Take that OPEC, it's only going to get worse for you.

        • 6 Years Ago
        This is by far the dumbest post i have ever read. Im going to guess that Mr. Oak works for Garmin.

        "It happens more often than you think. Two wrong turns on a single trip, could add quite a few miles to your trip."

        Seriously. you get lost and miss exits that much. I very very very rarely ever miss an exit. I dont travel to new locations hardly ever. I guarantee that if you are they type to miss signs you are going to miss your GPS telling you something too. Dumb Dumb Dumb.
        • 6 Years Ago
        Lol, ya I don't know how i'd get to work every day without one.
        • 6 Years Ago
        You get lost a heck of a lot! 75 gallons?! At 20mpg that's 1500 miles of being lost.
        I'd venture that most people probably drive the same local roads most of the time and only get lost when they're going somewhere they've never been. I've definitely gotten lost less since the advent of google maps/mapquest (especially google maps on my phone before I got a gps). But it's kinda hard to get lost to the tune of 75 gallons a year...that's getting lost for 40 miless every week!
        • 6 Years Ago
        It not even about always getting lost, simple miss an exit, next exit 10 miles, thats a 20 mile error. It happens more often than you think. Two wrong turns on a single trip, could add quite a few miles to your trip.

        I do a lot of long distance driving, If you are in an area thats unknown, a simple U-Turn is not always available. Get off the highway, and you may not always have an opportunity to immediately reverse directions.

        Unless you only the same route repeatedly, chances are you get lost too, more often than u care to admit.
      • 6 Years Ago
      Im sure its a matter of time,that gas prices are going back to 4-5$.
      • 6 Years Ago
      The BIGGEST secret in the world is OIL IS A RENEWABLE RESOURCE. People gotta realize the it wasn't THAT MANY dinosaurs on the planet years ago to supply fuel to the world as it is today.
        • 6 Years Ago
        • 6 Years Ago
        There are just as many stupid republicans but mostly just stupid people throwing hate around for no real reason
        • 6 Years Ago
        you're right. it is a renewable resource. i don't think it renews as fast as we use it though... i also think it took millions of years to create all the fossil fuels that we have been using. so in conclusion, you my friend, are an idiot and most likely republican.
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