Americans may spend $50 billion more on fuel in 2017
U.S. motorists are expected to spend $50 billion more to fill their tanks this year as rising oil prices put an end to $2 a gallon gasoline, squeezing consumer finances just as wages begin to rise.
Gasoline costs are expected to surge nearly 20 percent this year — they’re already up by 20 cents a gallon in the past month — following the Nov. 30 decision by OPEC to cut crude production, according to a forecast released Wednesday by GasBuddy, which tracks fuel pricing. Many economists compare rising gasoline prices to tax increases, which take money from Americans who otherwise might spend it in stores, restaurants and other consumer businesses.
But the news is mixed for drivers in Houston and other parts of Texas, where energy — namely crude oil, natural gas, and refined products — drives regional economies. The oil and gas sector is just beginning to rebound after a two-year bust that pushed scores of companies into bankruptcy and cost Texas 100,000 jobs, but also led gasoline prices to 12-year lows, bottoming at less than $1.50 a gallon in Houston last year.
Alex Lunde understands this economic tension. A Houston energy worker, he smiled Tuesday as he filled his car with gas for $2.70 a gallon at the Valero station — one of the city’s priciest — on Richmond Avenue near the Galleria.
He often reminds Houston friends celebrating low gas prices that a lot of jobs hang in the balance — including his. “When oil prices are a little bit higher,” said Lunde, 27, ” I’m a little bit happier because it means I’m not losing my job.”
Still, Lunde isn’t rooting for $5 a gallon gasoline either. “There’s a delicate balance that needs to be found,” he said.
Written by Jordan Blum