Ouil prices are tanking and as with anything economic, there are winners and losers.
From Bloomberg: Oil held gains after rebounding from the lowest price since February 2009 as the U.S. Congress sought to advance on a deal to allow unfettered crude exports for the first time in 40 years.
Futures were steady in New York after rising 1.9 percent Monday, the first increase in seven days. Senate leaders faced resistance from some Republicans and House Democrats, who were willing to discuss lifting trade restrictions depending on concessions they’d get in exchange, according to a Democratic leadership aide. OPEC President Emmanuel Ibe Kachikwu said the producers group may need a “very urgent meeting” if prices don’t recover by February.
Oil is trading at levels last seen during the global financial crisis after the Organization of Petroleum Exporting Countries effectively abandoned output limits as it sought to defend market share. Hedge funds and other large speculators raised bets on falling U.S. crude prices to a record while the International Energy Agency predicted the market will remain in surplus at least until late 2016. http://www.bloomberg.com/news/articles/2015-12-14/oil-falls-below-35-in-new-york-for-first-time-since-2009
So, some winners:
Consumers
Drivers
Airlines
Railroads
Truck drivers
Refineries
Government Agencies that use a lot of gas, like police departments.
The military.
And the losers:
Oil producers
Countries that depend on their oil revenues, like Russia.
Oil workers, especially those in areas like North Dakota, Montana, Alberta, Canada.
Land owners with mineral rights. (I know of 1 man whose monthly income went from about $250,000 to $60,000- he owns 200,000 acres with about 100 wells on the land)
State and local governments that depend on oil tax revenue.
Local government agencies, including city, county and school districts that rely on oil revenue.
The above government agencies who now have to provide newly unemployed with government welfare.
President Obama because with all the cheap oil and gas, which he hates, now will have to do with more pollution as people will drive, fly and use gas more frequently than if it was at his favorite price, over $4 a gallon.
All, in all, I think the lower energy prices will help the economy in most areas but not all areas.
At the Prairie Café...
4 hours ago
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