As the gas prices drop to nearly $2 per gallon, the sighs of relief from teenagers can be heard around the Denver metro area. However, as the wallets of consumers swell, the potential effects of lower gas prices on the economy is dismissed.
With more money in the pockets of people who drive, more money is spent on food, clothing and consumer products that may have not been spent before the drop of gas prices. According to journalistsresource.org, the average American family will save around $700 in 2015 from the drop of gas prices.
However, Heritage students will see the positive outcomes of lower gas prices as well.
“I can finally drive longer distances because I’m not ‘wasting’ as much money,” says Eva Chaffin ‘16.
The common tradition of Heritage students of driving to lunch will be embraced more, as well.
“I have more money to go out to lunch with friends now, instead of just bringing lunch from home,” says Emersen Dodge ‘16.
Although the drop of gas prices may wholeheartedly benefit American consumerism, it may cause economic turmoil in countries that produce oil, such as Iran, Russia and Mexico. These countries will have less cash flow, and could possibly enter into a crisis, according to the Wall Street Journal.
Larry Zimpleman, the chief executive officer of Principal Financial Group, believes that the gas prices will stay low for as long as decades. Currently, there is a lower demand for oil and a large supply due to the slow economic growth of the past decades, causing many to tighten their budgets and spend less on unnecessary products, including oil.
As the gas prices continue to lower, America may see an economic turmoil in oil producers, however the consumers are safe to spend as of now.
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