Literally, it may be time to meet at the gas station because the prices are finally going down. When I thought about gas prices I obviously had the rap song "It's Going Down", by Yung Joc in my head. It's been going down to the tune of 21 STRAIGHT DAYS with an average price around the country now at $3.60. Yes I said to the tune...I can get that song outta my head.
Why is this happening??
Economy
Well, start by taking a look at my last post written almost a month ago that outlined how high gas prices and not enough job creation hurts an economy. If prices stay high for too long it begins to change the way people do things. Remember Yung Joc said, "Meet me in the Mall, Meet me in the Club...it's going down"...well when gas prices stay high people start cutting back on buying gas and going to those spots. As more and more people cut back, carpool, take public transportation or just travel less, the demand for gas will continue to fall and so will the prices.
Over-Speculation
The other reason is there have been some high profile prosecutions recently of traders who were manipulating oil markets which has an impact on gas. These traders can at times make the supply or demand greater or less than what the real market demand is for oil and when the fools are removed from the equation it helps to bring gas prices down.
Oil Reserves
Lastly, the US government just released barrels of oil from a strategic reserve that is maintained for emergency situations. This was a coordinated effort of 28 countries around the world to release oil from emergency stashes in an effort to begin reducing the price and impact high gas is having on the global economy. The group of 28, also known as International Energy Agency (IEA), has taken these steps only three other times in history.
How to Invest - Stay defensive at this point - Dividends, Healthcare, and Energy
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