Oil prices are dramatically dropping, and many economists are crediting it to an always-present cycle of supply and demand in the oil industry.
Oil prices fell to as low as $81.21 on Monday, the lowest since October 26, 2011, according to an article by the Los Angeles Times.
Americans may be relieved by this news as gas and oil prices were rising to scarily-familiar levels, ala 2007 and 2008.
During that 2007-2008 time period when oil prices rose to a shocking $147 a barrel, many Americans made drastic life changes to cushion the sticker shock, like trading in larger cars for more fuel-efficient cars , as well as carpooling.
As oil prices slowly crept to upwards of $100 a barrel, some were afraid no relief was in sight and that they would perhaps have to make even more dramatic sacrifices to keep up with the seemingly ever-rising cost of oil.
However, as prices begin to drop, economists are saying this current rise-and-fall of oil prices is due to simple supply-and-demand.
According to data gathered by the Energy Intelligence Group, oil prices have dropped since march because the world has been producing more oil than it is consuming.
The U.S. is now sitting on a larger oil supply than it had since 1990, but it also has the lowest demand in the past 15 years.
The low oil prices aren’t necessary a good thing; in some economists’ eyes, they can just as easily rise back to their higher levels.
Still, lower oil prices may just be the fuel many Americans need to actually consume more by taking summer road trips and vacations. This will most likely further the volatile cycle of supply and demand.
The current national average for gasoline prices is $3.585, down 5.6 cents from this time last week and 28 cents from a month ago, according to AAA Gauge Fuel Report.