In light of the continuing crises in the Middle East and Japan, oil prices today are up about 27 percent from a year ago, hitting two-and-a-half-year highs. The two types of oil used as indicators, Brent crude and West Texas Intermediate crude, are hovering around $120 per barrel and $108 per barrel, respectively. These costs will almost certainly trickle down to the pump, maybe pushing gas prices up past the $4 mark. Experts say this extra cost could throw the tenuous economic recovery off track. [Check out a roundup of political cartoons on energy policy.]
The Bureau of Labor Statistics reported unexpectedly encouraging March hiring numbers last week—unemployment stayed under 9 percent and 216,000 jobs were added—but some fear that won’t be enough. "Employment continues to be weak in the United States and in Europe,” HSBC economist Simon Williams told Gulf News.“Rising commodity prices erode disposable income, and that's a real threat to a recovery that looks fragile in much of the western world.”
But U.S. stocks opened higher this morning despite the higher oil cost, and some say the increased employment numbers and nascent economic recovery will keep demand for oil growing, even with a higher price tag.
What do you think? Will rising oil prices kill U.S. economic recovery? Take the poll and post your thoughts below.
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