We all need some good news these days. It has been doom and gloom, well, since shortly after our current president took office. So, here is the silver lining: the price at the pump will go down over the next several weeks. It only makes sense that it will.
Crude oil dropped to $79.30 a barrel for September, closing at $85.72.
Patrick deHaan, senior energy analyst for GasBuddy.com says that the national average for gas will fall to $3.25 per gallon in the next two to three weeks as retailers slowly lower their prices to reflect their drop in cost.
It's also obvious why gas prices will drop. Our economy and the world economy is tanking. People don't have jobs and businesses aren't making as much of what businesses normally make and sell. Therefore, they are using less oil and gasoline.
James Williams of WTRG Economics notes, "Weak economies engender low oil prices. Stock market volatility illustrates the lack of confidence in recovery and an increase in expectations of another recession."
Some financial experts have warned of an impending recession. Just last week, following Standard and Poor's downgrade of the U.S. credit rating, Peter Schiff, an economic advisor to Rep. Ron Paul said:
The fiscal situation is going to deteriorate because we are either in or on the cusp of a recession. And remember, contrary to previous recessions, this one is starting with unemployment above 9 percent, starting with interest rates already at 0, so imagine what's going to happen when we get to the next round of fiscal stimulus. They're going to blow the deficit off the charts. And of course, the Federal Reserve can't do anything on the rate front, all they can do is print more money, which destroys the value of U.S. bonds.
And the cycle just keeps going and going until we hit dead bottom and start to rebuild from there.
Still, for those of us that are fortunate enough to have jobs, the reduction in gas prices will be a welcome relief.
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