Oil prices have started the New Year with a bang as the price of a barrel of crude oil currently sits just below $82 in early Wednesday (January 5th) trade on the New York Mercantile Exchange.
Benchmark crude oil for February delivery was at $81.53 in the morning, down 24 cents. This was after a close on oil prices of $81.77 Tuesday, a day in which oil contracts were up 26 cents to a 14 month high.
The recent surge through the $80 level for oil prices has been largely attributed to changes in supply and demand factors. While oil prices are surely going to help keep gas prices high as well, it is a good sign that perhaps consumers and businesses are finally showing renewed interest in travel and business expansion.
Today crude oil hit a new yearly low once again. Now crude oil is 44 dollars a barrel after hitting an all time high of 147 in July. With economies around the world collapsing and demand for oil drying up the price of crude is in a very powerful downtrend. It would not surprise me to see crude oil below $30 a barrel barring some supply shock before it bottoms.
We all knew that the recent increase in price for crude oil would affect the price of gasoline, but it's more far-reaching effects have seemed to catch many Americans off guard. However, the price of crude oil affects nearly every single thing we purchase. The truckers carrying the food and goods that Americans depend on, have also suffered greatly from the rise in crude oil and subsequent increase in the price of a gallon of gasoline. Perhaps the hardest hit by the recent escalating of crude prices is the American airline industry. The fallout from the huge increase in jet fuel costs has left the industry in shambles.