March 12, 2008
$110 per barrel
It seems like less than a year ago I was reading editorials all the time that mentioned the dire possibility of oil reaching a catastrophic $100 per barrel. But once it hit that mark, I suddenly stopped hearing about it (or at least is isn’t being discussed in the same way). So what’s the deal? Is the American economy much more resilient than we though it was, or are we just avoiding even glancing at the pressure gauge that is pegged in the red zone? Today I hear that oil hit $110. I wonder what the new benchmark for disaster is–$150? $200? At what point will gasoline prices hit that level at which one more grain of sand is added to the pile, and it dumps the whole thing?
comments
3 Responses to “$110 per barrel”
Leave a Reply
good question. I saw this article on the idea of $200 a barrel being tossed about.
I think the disaster will come to us individually. It will come when your particular income will no longer cover the necessary expenses needed to drive to work, heat your home, etc. Whether this catastrophe happens at $101/barrel or $300/barrel will depend on how much you earn (or how big the trust fund is). I personally know several people who are already feeling the crunch.
hubs: I too think it will come individually–and I know some people, as you do, who are already having to make some very hard choices because of this. But I believe there will also be a point of cascade failure reached when a certain large number of individuals fall out of the economy. That’s the point at which social services are further strained and the desparate begin to act in ways that cause the wealthy to circle the wagons and put up walls. I guess America is so wealthy it will take a long time for the middle class to sag into the ditch, but given that 70% of GDP is consumer buying, as opposed to, say manufacturing(!)–how long will that hold things up? Lots of golden parachutes will be landing in Europe and other more hospitable realms.