Nightly Business Report, Feb 21, 2012

Rising Oil Prices vs Recovering Economy

by EditorTB on FEBRUARY 21, 2012 in COMMENTARIES, ECONOMY
SUSIE GHARIB: As we reported earlier in the program, oil futures traded at
a nine-month high today. Tonight`s commentator worries those higher oil
prices could hurt the U.S. economic recovery. He`s Simon Constable,
columnist at “The Wall Street Journal.”

SIMON CONSTABLE, COLUMNIST, THE WALL STREET JOURNAL: Something in the
Middle East has a good chance of blowing a hole in your pocketbook. A
growing spat between Israel and Iran has oil prices surging. A row between
Sudan and south Sudan is making it worse. Right now, oil costs $106 a
barrel, up from around $98 at the beginning of the month. What that means
for you is higher gas prices — much higher. A gallon nationally now
averages $3.57, up 13 percent from a year ago, according to the latest AAA
report.

It will likely reach $4 soon. It`s already there in California. Heck,
it`s not even summer driving season yet. So, what? Well it`s likely that
this surge in prices will worsen and put the brakes on a very fragile U.S.
economy. Think of it like a tax hike just when we don`t need one. The
higher gas bills will suck money out of your wallet that could have been
spent on other things. It will be bad for jobs. It means it could be time
to hunker down and save whatever extra cash you have. I`m Simon Constable.

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