Nov
10

Crude Concerns

oil rigBecause the US still imports 5 million barrels/day of oil, and consumers spend a substantial share of income on energy, cheaper oil boosts GDP. Every $10/bbl decline shaves 25 cents off the price/gallon of gas and reduces oil imports by $50 billion/year. That will boost GDP by almost half a percent. If oil falls below $65/barrel, the benefits remain positive but shrink as US drilling and exploration activity will fall.

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Comments

  1. Mark Scolnick says:

    My neighbor is a gasoline dealer in Kentucky and they cannot get the “cheap”-market gas unless they pay a premium.
    What is going on?
    Thanks

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