The price of crude oil has been steadily declining a midst predictions of overproduction.
The price of oil has dropped as much as 14 percent to $63 a barrel in the largest decline in price in the past 5 years. Oil is now cheaper than it has been since 2010.
While that may be bad news for oil companies like Chevron and Exxon, it’s great news for consumers heading into the holidays. Lower energy prices means more money in the average Americans pocket for spending. These prices are expected to remain in the $65 a barrel range well into 2015.
The are some who are concerned the lower prices could affect the U.S. Shale oil producers but there have been no signs of that being the case as of yet.
It’s only natural to wonder why the sudden decline in the price of oil and as a result the price of gasoline and there are primarily five major reasons oil prices are down.
- The US oil boom
- Libya’s return to the oil production
- Discord between OPEC members
- Negative European economic outlook
- Lower oil demand from Asia
Whatever the details may be, lower prices at the pump mean more dollars and spending power for the rest of us.