by The Literature

Created on: June 22, 2008   Last Updated: June 13, 2009

Crude oil touched $136/barrel last week. Saudi Arabia announcement on plans to boost daily output by 200, 000 barrels helped crude oil price to slump to $132/barrel.

Demand for oil is huge in United States of America, where car use is on the rise because of the summer holidays. In China demand is going high, where industrial production is racing ahead. Energy starved country; India had to increase the fuel price recently.

Increase in oil price would bring other products cost higher. There is no short term answer for the gasoline price issue.

These days' people started to use term "gallon per miles" instead of "miles per gallon". People started to worry about the inflation and spending power has gone down.

Personally my gasoline bill has gone up to $250 in last three months. All drivers in United States paying record prices for fill in their vehicle tanks.

As per the study in 2005 & 2006, an average US household spent nearly 3% percent of their annual income (after tax) on gasoline because of lack of access to public transportation.

Recently I saw a big line in front of a money converter machine in one of the well known shopping mall. I could feel people who started to neglect even one penny, started to realize the power of that due to recession and fuel cost. People started going to one nearest location where they can buy everything including grocery, they do not mind walking three or four minutes around from parking place just because it saves them few drops of fuel.

Some started to prefer jobs closer to their homes so that they can avoid long drive. Get-together and partying has come down. People are saving money suspecting a negative economy in next few months.

Few of neighbors share their cars while commuting to office with maybe 3 or 4 passengers in them. People started to drive less, and I have been witnessing a dramatic shift in purchasing behavior in choosing more efficient vehicles. One of my neighbors sold out their second car; personally I have cancelled my decision to buy a second car.

Now, summer vacation started, people are trying to do better home work in maintaining their costs like minimize usage of gas & electricity, cutting down cable & internet. From canceling vacations, skyrocketing gas prices have inspired many to make a wide variety of lifestyle changes.

Energy is the main commodity which balances the United States economy. If there is no proper energy trade, then US economy may shake.

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