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The Impact Of Oil On The U.S. Economy

Oil is used for many thing in The Unites States, Gasoline for our vehicles, Heat for our homes, even in plastics that are used for everything. Oil is shipped from other countries like Iran and Iraq on huge barges across the ocean. Without the import of oil from other countries, The United States Economy would suffer greatly. Taxation on oil brought from other countries helps to fuel our the economy. After the United States purchases the crude, or raw, oil, inflation and taxation are applied to the cost before it is available to the general public.

The recent United States recession is still fresh in the minds of millions of Americans. The lack of employment and cash flow from the United States affected people the world over. The cause of this recession began with the astronomical rising of gasoline prices. The gasoline prices rising affects everything from the cost of shipping goods to employees ability to get to work. The gasoline prices rise when the oil prices rise. Countries like Iran and Iraq hold control over the cost of crude oil and when they are feeling threatened or mistreated by other countries, they will often raise the cost of oil. This is what happened during the 1990’s during The Gulf War.

The United states has seen a significant drop in the price of gasoline over the past 6 months. This is due to the fact that the cost of oil has dropped and allows for the United States to lower the pricing. The effects of this lower oil cost can be felt throughout the entire world. When gas prices drop, the cost of exporting goods to other countries drops, which allows them to purchase more goods and provides work for more American people. The cost of travel drops for citizens, allowing them take trips and spend more money in other areas. Fluctuations in the cost of oil can be felt and seen in everything from small business, to large corporations, schools, and blue collar workers.

The average cost of a gallon of gasoline in the 1950’s was around forty cents. The average cost of a gallon of gasoline in the 1990’s was around $1.00. Over the past decade, gas prices skyrocketed to over $4.00 per gallon in some places. Coincidently, the United States recession began within the last 5 years, coinciding perfectly with the rise in oil and gas prices. The cost of medical treatment rose as well during this time because of the cost of plastics and gasoline for emergency vehicles. People were feeling the rising oil prices even in the grocery store where oil is used in shipping goods and creating plastic packaging, among other things. The price of oil has recently dropped and Americans can feel it already. More people are spending their monay at stores, donating, contributing to the economy in different ways. People are traveling more, paying more tolls on the roadways and creating an overall better economy for all.