Have you noticed yours?How Oil Prices Impact the U.S. EconomyThe oil industry, less than 2% of GDP, would suffer. While the much, much, much larger economy that uses oil
would benefit.
The other groups that tends to suffer when U.S. oil prices drop are the banking and investment sectors. There are a lot of different companies drilling and servicing wells on the shale deposits, and many of these companies finance their operations by raising capital and taking on debt. This means that investors and banks both have money to lose if the price of oil drops to where new wells are no longer profitable and the companies dependent on drilling and service then go out of business. Of course, investors and bankers are well-versed in risks and rewards, but the losses still destroy capital when they happen. Between the job losses and the capital losses, a dip in oil prices can trim the growth of the U.S. economy.
Read more: How Oil Prices Impact the U.S. Economy | Investopedia How Oil Prices Impact the U.S. Economy
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The price of oil influences the costs of other production and manufacturing across the United States. For example, there is the direct correlation between the cost of gasoline or airplane fuel to the price of transporting goods and people. A drop in fuel prices means lower transport costs and cheaper airline tickets. As many industrial chemicals are refined from oil, lower oil prices benefit the manufacturing sector. Before the resurgence in U.S. oil production, drops in the price of oil were largely viewed as positive because it lowered the price of importing oil and reduced costs for the manufacturing and transport sectors. This reduction of costs could be passed on to consumer. Greater discretionary income for consumer spending can further stimulate the economy.
Have you noticed your error?
Haven't made one.Your opinion is of no greater value than any of the authors in the links i cited.Have you noticed yours?How Oil Prices Impact the U.S. EconomyThe oil industry, less than 2% of GDP, would suffer. While the much, much, much larger economy that uses oil
would benefit.
The other groups that tends to suffer when U.S. oil prices drop are the banking and investment sectors. There are a lot of different companies drilling and servicing wells on the shale deposits, and many of these companies finance their operations by raising capital and taking on debt. This means that investors and banks both have money to lose if the price of oil drops to where new wells are no longer profitable and the companies dependent on drilling and service then go out of business. Of course, investors and bankers are well-versed in risks and rewards, but the losses still destroy capital when they happen. Between the job losses and the capital losses, a dip in oil prices can trim the growth of the U.S. economy.
Read more: How Oil Prices Impact the U.S. Economy | Investopedia How Oil Prices Impact the U.S. Economy
Follow us: Investopedia on Facebook
Thanks for the link......
The price of oil influences the costs of other production and manufacturing across the United States. For example, there is the direct correlation between the cost of gasoline or airplane fuel to the price of transporting goods and people. A drop in fuel prices means lower transport costs and cheaper airline tickets. As many industrial chemicals are refined from oil, lower oil prices benefit the manufacturing sector. Before the resurgence in U.S. oil production, drops in the price of oil were largely viewed as positive because it lowered the price of importing oil and reduced costs for the manufacturing and transport sectors. This reduction of costs could be passed on to consumer. Greater discretionary income for consumer spending can further stimulate the economy.
Have you noticed your error?
Haven't made one.
Do you feel their opinion in any way disagreed with mine?