Wednesday, February 4, 2015

The Gasoline Windfall

One of the biggest financial stories of last year was the dramatic drop in gasoline prices, down $1.22 a gallon from where they were a year ago. Bloomberg News has tried to asses what that meant for the average American consumer, and reported that what we saved at the pump had the impact of a $125 billion tax cut.

Obviously, we could afford to drive more. In November, Americans drove 241 billion miles, the most for that month since 2007. So one of the big winners was drivable vacation destinations: Car traffic to Las Vegas, for example, jumped in the last quarter of 2014, after being down six of the previous nine months. Other winners include mass-market, working-class companies like Popeyes Chicken and Family Dollar.

But the spending spree may be coming to an end. After the average gas price in the U.S dropped for 123 straight days, that streak finally ended last week, and gas prices are finally starting to turn upward again.


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