Oil Prices and the U.S. Economy

Paper Summary:

This paper contends that the price of oil has a measurable impact on the economy. However, the paper explores at what point the terrorist attack of 2001, the corporate scandals of 2002 and the Iraq war of 2003 became simply economic footnotes rather than an influencing factor on the buying power of the American public. The paper explains that since the price of oil does not exist in an economic vacuum, there are some indicators that can be tied directly to the price of oil. The paper claims that understanding the impact of oil prices involves examining the economic effects that occur directly following rising oil prices and placing those effects in their proper context.

From the Paper:

"It is this fact that makes the case that although oil prices are extremely high, they are not to the catastrophic levels that investor psychology proclaims them to be. But the oil price increase is nevertheless significant, especially with the percent of increase for oil prices as high as it has been. It therefore may appear confusing that the economy has been able to resist a major pull downward. Restraint by the Federal Reserve, undaunted consumer confidence and fearless corporate purchasing have all contributed to the economy's ability to weather the oil price storm."

More papers on Oil Prices and the U.S. Economy:

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• Research Paper # 103343 : "Iraq War and the U.S. Economy"
• Cause and Effect Essay # 140358 : "Oil Price Increases on the U.S. Economy"

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