Why LOW Gas Prices Can Be Bad For The Economy
As consumers, its fun to play the game 'How Low Will They Go." How low will gas prices actually dip? Many areas in Iowa are seeing prices nearing $1.50 per gallon! And if you think that's low, some experts believe prices could go even lower. But that isn't necessarily good news for our economy.
GasBuddy price analyst Patrick De Haan says that some areas of the U.S. could even see prices hit the magically 99 cent mark soon!
De Haan already noted that there are 16 states in the U.S. that have already seen gas prices dip to $1.50 or lower. So why are prices in a free fall? Sure, coronavirus fears play a small part, but the bigger event is the oil price war going on between Saudi Arabia and Russia. Saudia Arabia increased production and slashed prices, which sent oil prices into a free fall. Good news for you and me at the pump, but bad news for other Americans.
More than 6 million people in the U.S. are employed by the energy sector. For some oil producers, the sudden drop in prices could mean massive layoffs. Haliburton announced it was furloughing 3500 employees. Next week, employees on mandatory leaves will work one week, and be off the next for 60 days.
Fewer Americans are traveling because of virus fears, we're using less gas and oil, and the price of crude continues to plummet. Great news if you're on empty. Not so great for others.