Expository Essay on Gas and Oil Prices
How Oil and Gas Prices Affect the Economy
Stacey Melton
Eng. 101
September 5th, 2010
Karen Glass
How Oil and Gas Prices Affect the Economy
While supply and demand affects oil and gas prices, the United States and surrounding countries may be suffering economically due to their intense dependence for crude oil. The effects on our economy today are somewhat extreme. Population growth combined with current unemployment rates have temporally brought on a recession. According to Dictionary.com (2010) “a recession is defined by a significant decline in activity spread across the economy, lasting longer than a few months.” Over the past 20 years our economy has seen the effects of both recession and economic growth. Many of the changes we face today are because of several factors, but the most influential could be oil and gas prices. The United States does not stand alone on the inflation of gas prices though surrounding countries are trying to cope as well. High oil prices are of significant importance to the world’s economy, and can cause adverse reactions. Although most economies have become adaptable over the years, countries are still trying to find ways to deal with these changes. Oil and gas prices rise or fall daily and global demand is growing as well.
Although the United States was once a major exporter of oil, today it relies on foreign exporter to supply most of their oil needs. The United States exports oil from Canada, Mexico, Saudi Arabia, and Venezuela, just to name a few. These foreign countries supply the United States with 60 percent of their oil needs. The other 40 percent comes from such states as Alaska, Texas, and California. In such cases of an emergency, such as a hurricane, the United States maintains an oil reserve. According to Amadeo (2010) “The U.S. uses 20% of the world’s oil” (para. 6). The amount used for transportation is two thirds of the worlds oil and this includes what oil is used for heating during the winter
Stacey Melton
Eng. 101
September 5th, 2010
Karen Glass
How Oil and Gas Prices Affect the Economy
While supply and demand affects oil and gas prices, the United States and surrounding countries may be suffering economically due to their intense dependence for crude oil. The effects on our economy today are somewhat extreme. Population growth combined with current unemployment rates have temporally brought on a recession. According to Dictionary.com (2010) “a recession is defined by a significant decline in activity spread across the economy, lasting longer than a few months.” Over the past 20 years our economy has seen the effects of both recession and economic growth. Many of the changes we face today are because of several factors, but the most influential could be oil and gas prices. The United States does not stand alone on the inflation of gas prices though surrounding countries are trying to cope as well. High oil prices are of significant importance to the world’s economy, and can cause adverse reactions. Although most economies have become adaptable over the years, countries are still trying to find ways to deal with these changes. Oil and gas prices rise or fall daily and global demand is growing as well.
Although the United States was once a major exporter of oil, today it relies on foreign exporter to supply most of their oil needs. The United States exports oil from Canada, Mexico, Saudi Arabia, and Venezuela, just to name a few. These foreign countries supply the United States with 60 percent of their oil needs. The other 40 percent comes from such states as Alaska, Texas, and California. In such cases of an emergency, such as a hurricane, the United States maintains an oil reserve. According to Amadeo (2010) “The U.S. uses 20% of the world’s oil” (para. 6). The amount used for transportation is two thirds of the worlds oil and this includes what oil is used for heating during the winter
References: Amadeo, Kimberly. (July 14, 2010). How oil prices affect gas prices. Retrieved July 17th, 2010, from About.com website U.S. economy.about.com/od/supply/oil_gas_prices.htm Gas prices around the world. CNN money. (March 2005). Retrieved June 23rd, 2010, from money.cnn.com/pf/features/lists/global_gasprices/ Richardson, Leslie. (2009). Republican and Herald. Drivers feel pinch from rising gas prices, volume 1, page 1. Retrieved June 24th, 2010, from republicanherald.com/news/drivers-feel-pinch-from-rising-gas-prices The price of liberty. (April 30th, 2008). Retrieved July 2nd, 2010, from www.thepriceofliberty.org