|
Rising fuel costs impact economy |
|
|
|
Thursday, 24 January 2008 |
by ERICA DURHAM
News Reporter
On Jan. 15, President George W. Bush asked Saudi Arabia and the other members of the Organization of the Petroleum Exporting Countries (OPEC) to consider the effects of higher fuel costs to the United States economy.
“A few of the longer effects will eventually be that people will decide to drive less or change their vehicles,” said Dr. John C. Whitehead, an economics professor. “For the first time, last year the Toyota Prius outsold the Ford Explorer.”
The New York Times quoted President Bush as saying, “When consumers have less purchasing power
because of high prices of gasoline - in other words, when it affects their families - it could cause this
economy to slow down. If the economy slows down, there will be less barrels of oil purchased.”
As of press time, fuel costs in Boone varied from $3.05 to $3.09.
“The cost of fuel has affected what we pay our drivers,” Boone Domino’s Pizza Manager Drue M. Sokol
said. “They make more because they have to factor in tires and oil changes. That makes a difference.
We now pay our drivers by the drive.”
Saudi Arabia’s Oil Minister Ali al-Maimi said in The New York Times that a downturn in the United
States economy could have profound effects around the world, including the oil market.
This will also affect where people live in relation to where they work.
“People are deciding to live closer to their workplace. The long term effects could be less suburban
sprawl,” Whitehead said.
Gasoline prices are not the only prices affected by higher oil prices.
“Some people have oil as their only heating source,” Whitehead said. “I believe they will begin to switch
away from it, the way markets work. There will be a demand for less expensive sources.”
“Jet fuel is more expensive. This could increase plane ticket prices,” Whitehead said. “Trucking prices
could increase also and increase the price of goods being transported. It will have a ripple effect
through the products.”
The higher fuel costs have also affected the cost of oil as a heating source.
“The biggest part is keeping the supply, and keeping prices down so people can afford it. It is just not a
very affordable energy,” District Manager of Appalachian Energy David Warren said.
The long-term effects of higher gas prices have been harder to see than the immediate ones.
“Some [of our customers] have started burning wood instead but it will be harder to tell the effects until
later this year,” Warren said. “It affects all of our drivers. It costs more so we try to be efficient in our
deliveries.”
Trackback(0)
 |
TrackBack URI for this entry
Show/Hide comments