As the current economic slowdown bites into the global economy, crude oil prices are beginning to rise as the Federal Reserve starts to tighten monetary policies. This comes as no surprise when one considers how weak the dollar has been in recent years.
Oil prices will be impacted by the upcoming presidential election in the United States. Whoever wins, will likely start to implement free market reforms. These should help to put a dent into high oil prices, but what happens when it is time to change policy? How much further do you want to go?
Well, if you are not already on board with the idea that your pet project, such as the Keystone Pipeline, could cause a price spike and a dramatic increase in fuel costs, then you may want to reconsider. The price of crude oil is set to go up after the election, but that does not necessarily mean that it is going to continue to go up until the end of the year.
The most obvious cause of a price spike, other than political factors, is the global economic slowdown. In the case of the United States, the global economy is slowing down due to the housing crisis, job losses, and an overall lack of confidence in the economy. As a result, people are taking a closer look at their spending habits. They are asking themselves whether or not they really need to buy that new car, or if they can cut costs by getting used ones instead.
If you are concerned about a possible price spike on crude oil, there is good news for you. There are some signs that suggest that the world economy could turn around soon. If the United States economy is able to bounce back and start creating jobs again, the world’s economy will be able to pick up, and in turn bring back some of the stability that many of us are looking for.
It is too early to tell if crude oil prices will spike in response to an expected increase in US-Iran tensions. However, with the way that the economy is performing at the moment, it would be surprising if it was not. in fact that the Iranian economy is already slowing down. and the increase in US sanctions against Iran’s oil exports would only serve to further increase prices.
The good news is that oil prices can be controlled to a degree and still allow you to enjoy a higher standard of living. The only thing left to do is wait to see if the world economy improves or takes a huge hit.
However, this does not mean that you should take for granted the idea that economic collapse is imminent. If you are looking at saving money, it might be a good idea to continue on the course that you are on, even if the economy gets back on track and oil prices go up.