Monday, December 1, 2014

Gas prices are headed below $2.00 a gallon in the southern U.S.

Gas prices are headed below $2.00 a gallon in the southern U.S. due to the region’s low taxes and numerous refineries as oil prices continue to fall, but the decline points to the beginnings of a global recession.

The price of crude oil is falling towards $40 a barrel, and while this benefits American consumers,especially those in the south, it indicates a global recession because production alone is unlikely to cause such a drastic decline in oil prices.

“Oil’s decline is proving to be the worst since the collapse of the financial system in 2008 and threatening to have the same global impact of falling prices three decades ago that led to the Mexican debt crisis and the end of the Soviet Union,” Bloomberg reported.

The prices are declining partially due to the Organization of Petroleum Exporting Countries’decision not to cut production to try and force the U.S. shale industry out of business.

It’s already beginning to work. Several American oil exploration and drilling companies are slowing down because the industry is already close to unprofitable.

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