The Economic Impact On The Economy

Decent Essays
Oil is a huge part of everyone’s everyday life. From transportation to heating homes and businesses, oil prices are always dramatically changing due to the constant change of supply and demand. The economic impact that the price of oil has on the U.S economy continues to rise and fall due to political instability. Americans especially have a heavy reliance on oil, especially on foreign origins. The increasing price of oil has spiked large concerns and has become a major global debate. Many sources of oil are in economically and politically unstable regions and countries like former Soviet Union, the Middle East, and Africa. Not only is oil affected by this instability, prices are also determined by natural disasters and political issues. Due to an increase in demand, oil prices in 2011 increase instability due to more instability in oil producing countries like Saudi Arabia because of conflicts and uncertainty. The oil industry is one of the Commanding Heights of the global economy and therefore should not be regulated. It is a global commodity and is the most efficient method of allocation through the free market.
The regulation of oil prices will produce the following effects. “The heightened concern over oil resources caused Americans to consider their reliance on oil, particularly from foreign sources…a debate has grown over “peak oil,” or the point at which production can no longer increase, this beginning a decline in resources; there is considerable and intense
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