Gas goes up economy goes down

            This week’s topic is one that has been hot all over the United States over the past week. The topic is gas prices and how high they have jumped in the last week. All information provided was found in the article “Gas prices surge 17 cents in a week” by Ben Rooney on CNNmoney.com. This article was chosen because it is something that everyone can relate to. It was also chosen because it affects the prices of other products.

            The article was presented to the reader as stating the problem right off the back. The article starts with the total amount of the price increase, which is 17 cents. After discussing this it showed a national average of the price of gas. Then it showed the state with the lowest priced and the state with the highest priced gasoline. The article states the problem and reasoning for the extreme jump in gas prices in the last week. It next states what is to come in the near future for the prices of gas. The author states some ideas of how the energy cost will change the economy recovery for the United States.

            Gas prices shot up last week by 17 cents. Thursday February 24, 2011 gas prices went up by 6 cents in one day. This was the highest price rise in a single day since October 2008. Gas prices are predicted to continue to climb up as the next few weeks approach us. The price of a barrel of crude oil is now at $103 dollars. For every dollar increase in the price of a barrel gasoline prices will rise by at least 2.5 cents. This is because crude oil is the main ingredient in gasoline.

            Just on last Thursday I rode by the gas station as the pandemonium about gas prices were beginning. Thinking that the gas would not raise much over the next 30 minutes I proceeded to wash my car. After 30 minutes I come back to the gas station to find that gas prices had raised by 10 cents in a 30 minute period. The crude oil price had risen almost by 10% Thursday causing this dramatic change. This change affects everybody in the United States. This will change the prices of food, clothes, and the cost of living in general.

            With the prices of gas growing so rapidly, it will affect the economy’s recovery plan. This is because for every dollar increase in the price of oil costs the consumers of America $1 billion dollars. Consumer spending makes up a lot of the gross domestic product. In the last three months the chart read that the GDP has only grown to 2.8%. The normal growth rate of the GDP is 3.2%. This statistic is an example of how the prices are already affecting the economy’s recovery.