Lower Gas Prices Due to Economic Crunch
It seems like in each post, I come on and preach of economic doom and gloom. I try to be positive amidst the turbulence and finally have a hint of good news to report. According to the Energy Information Administration ‘s weekly Inventory report, crude stocks (supply) are on the rise. Oil stock rose by 7 million barrels last week, which put us in the middle curve of the average range for this time of year. This is the lowest level at which oil has traded since January 24, when oil temporarily dipped down to $87.01 per barrel.
What’s being credited to this increase in supply? Why a decrease in demand of course (for those who forget their Intro to Economics lessons). People are literally driving less due to the economic crunch proving that some good can come out of the turmoil. After all, the United States remains the world’s largest economy and fear of recession has global repercussion.
Unfortunately, we’re not going to get through this Money management post without a little bad news. The National Association of Realtors has released word today that home prices are likely to continue to decline in 2008 (for the second year in a row). Just a month ago the Association was predicting an ugly start to 2008 but a rebound in the second half of the year. Now their forecasts are looking a bit more bleak; with hopes of 2009 (and beyond) representing the earliest periods of recovery.
Since oil trading and domestic housing represent only two of dozens of markets credited with influencing the economic situation, these opposite reports do not cancel each other out. The positive spin is to hope gas prices continue to drop at the pump while we wait-out the proverbial turbulence.
