Even though the economy is reported to be recovering, prices everywhere seem to be going up. Rising oil prices caused partially by the problems in Libya have the possibility to create multiple problems in the rebounding economy. Summer is coming and if you are planning a road trip, high gas prices could put a damper on the summer fun. For those flying to their destination over the summer, the gas prices are causing much higher airline flight costs. At what prices does gas have to reach for families, who may already be in a financial crunch, to cancel their spring break or summer traveling plans? When gas prices reach the point where traveling slows to that degree and cities and businesses that count on that summer cash flow suffer, what will happen to the economy then? This story reported by USA Today shows that even those who are still traveling for spring break may be cutting costs elsewhere on the vacation to compensate for the high gas prices. This may mean that travelers are spending less at local businesses.
It is estimated that if oil prices rise to $110 a barrel, there would be a 19% increase in overall prices. CNBC asks in this article, what price gas must reach before we reach the “freak out point”. The article points out that small business owners purchasing trucks and SUV’s has been a boost in the economy but will this continue if prices continue to rise? With families as well as businesses already struggling to emerge from the economic problems, at what point do gas prices have to reach before it will greatly effect your lifestyle?
- Gas prices put brake on spring break for many (travel.usatoday.com)