With 4th of July just around the corner, peoples’ thoughts turn to spending and how much they will be able to fit into their budget. This year, the amount of money in the budget might be just a little bit higher than it has been in the past, and that’s due to the dropping price of gasoline all around the nation. With the discounts on crude oil from Saudi Arabia, combined with the increase in gas and oil production in the country, it means big savings at the pump.
This is the first time in the past four years that gas prices have, on average, dropped to below $3 per gallon. This drop in price can have a large scale effect on the economy, which could help to give it that extra boost that it needs right now. Even though the economy is certainly on an upswing, these extra savings come at a great time. They put more money into the pockets of Americans who can then turn around and buy more for the holidays, which actually boosts the overall economy even further.
This is quite helpful for those families who fall in the low and middle-income brackets. They have not experienced the same growth that other Americans have felt, and the average income for those who fall into this group is actually several percent lower than what it was seven years ago.
Of course, whenever one area of the economy goes up, it seems as though another area dips. That’s also the case here, and it is important to note that the lower prices could actually cause a drop in the production of domestic oil in the future. However, the prices are not quite that low yet. They are in a “Goldilocks zone”, where companies are still able to drill and produce oil domestically without taking too drastic of a hit, and where people are saving on their oil and gas costs.
Most of the experts actually feel that if the price per barrel of oil is able to hover at around $80, there will be no need to drop production. However, if it were to drop below $70 a barrel, it could cause slowing in production levels, as it would not be as profitable. Currently, the important thing is that consumers are getting some relief when they head to the gas station, and it could mean that a few more of the lower income and middle income families could have a brighter holiday travel.
About Oil Works Inc.
Oil Works, Inc. is a complete drilling rig equipment manufacturer and service provider based in the Permian Basin for over 20 years. OWI’s product and service offerings include Derricks, Substructures, Drawworks Manufacturing, Mud Systems, Rig Walking Systems, Power Generation, Control Systems, Iron Roughneck Service, Quincy Air Compressors. We are a complete Drilling Equipment Manufacturer and build to API and ISO standards. OWI is also proud to offer 24/7 Service and Support.