gas prices

Happy times are here again at the gas pump. The price of oil keeps falling, and Americans are filling their tanks for less than $2 a gallon. The government says cheaper gasoline put an extra $100 billion into drivers' wallets last year alone.

That seems like it would be good for the economy. Turns out, it might not be.

"Is it possible that lower oil prices could actually hurt the U.S. economy?" asks Vipin Arora, an economist with the U.S. Energy Information Administration. "I think the answer could be yes."

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Transcript

ROBERT SIEGEL, HOST:

In Oklahoma, the economy runs on oil. The energy industry drives 1 in 5 jobs and is tied to almost every type of tax source. So falling oil prices have created a state budget crisis. Joe Wertz of State Impact Oklahoma sent this report.

There were high-fives this week from Detroit to Washington, D.C., as carmakers celebrated record auto sales.

Americans bought 17.5 million cars and trucks in 2015. That's a huge turnaround from 2009, and the Obama administration cheered the rebound as vindication of the president's decision to rescue General Motors and Chrysler from bankruptcy.

"Because of the policy decisions that were made by this administration to place a bet on those workers, America has won, and our economy has been better for it," White House spokesman Josh Earnest told reporters Wednesday.

Like cheap gasoline?

Then you're in luck. Experts say gas prices very likely will keep falling. That's because a report released Wednesday showed a sharp increase in gasoline inventories.

The U.S. Energy Information Administration said that last week, companies added another 10.6 million barrels of gasoline, creating the biggest surge in supply since 1993. That added to fears that supplies will far outstrip demand for a long time.

Joe Wertz

A $900 million hole in next year's Oklahoma state budget and a projected shortfall for the last six months of the current fiscal year could deepen if the price of oil and natural gas stays at low levels not seen for more than a decade.

The price of oil has hovered around $35 per barrel for nearly two weeks; forecasters predict an average price of $42.83 through June 30. The projected price of oil for the fiscal year that begins July 1 is $53.57 a barrel, according to the Oklahoma Tax Commission.

Few images evoke the lazy hazy days of summer more than a convertible driving down the coast. Soon, though, that image may be pure nostalgia.

Sales of convertibles have seen a steep decline, falling by more than 40 percent in the past decade alone. And with new, tougher fuel economy standards, the days of riding with the top down could be numbered.

Jack Nerad of Kelley Blue Book has owned a 1962 convertible Corvette for nearly 40 years. Nerad lives in Orange County, Calif., a seemingly ideal place for a convertible, but his classic car often stays at home.

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Flickr / jeepersmedia

Oil prices hit a six year low earlier this week as China devalued its currency.

The move is sparking fears of a slowing global economy.

KOSU's Michael Cross spoke with Russell Evans, executive director of the Steven C. Agee Economic Research and Policy Institute at Oklahoma City University about the possible heightened anxiety for the rest of 2015.

Evans says like most everyone else in the state, he's hoping things get back to normal soon.

Oil prices took another drop Monday, rattling the stock market and putting more downward pressure on gasoline prices.

For oil companies, the price slump is hitting hard at profits, but for U.S. motorists, the downshift has brought savings at the pump.

Never before has the U.S. had so much oil spurting up out of the ground and sloshing into storage tanks around the country. There's so much oil that the U.S. now rivals Saudi Arabia as the world's largest producer.

But there has been some concern that the U.S. will run out of places to put it all. Some analysts speculate that could spark another dramatic crash in oil prices.

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