For many people in California, a decline in the amount they have to pay for gas prices is a welcomed site. People often still discuss how foreign it seems to pay less than $1 for a gallon of gas, but everyone agrees that those days have long since passed. However, what many people may not realize is that a drop in the price of gas has both positive and negative effects.
Throughout the history of America, there have been times when lower gas prices were primarily favorable, but with the drastic changes to the nation’s economy throughout time, lower gas prices can have far-reaching effects in more than one way. As the largest producer and consumer of oil in the world, the natural resources industry in the United States can have startling effects on several other notable industries when it fluctuates.
When gas prices drop lower, Americans may be celebrating the surface positive of paying less for gas. However, behind the scenes, it is an indication that oil prices are declining which ultimately leads to job loss in that sector. With a steady decline in the oil industry, other industries may soon begin to feel the nagging effects. In modern America, lowered gas prices can significantly negatively influence the economy. According to a study completed by the American Petroleum Institute, 10.3 million jobs in the nation are rooted in the oil industry. As such, a continuous decline in gas prices can potentially translate into an exponential loss of jobs and an adverse effect on the economy.
If people are looking into investing in the oil and gas industries, they may benefit from working with an attorney. Legal professionals have experience that enables them to understand the challenges of investing in such a volatile industry.
Source: Napa Valley Register, “Why lower gas prices are both good and bad for the US economy,” Matt Egan, Jan. 2, 2019