Why Gas Prices Aren't Likely to Hit $5 This Summer
CNBC Senior Commodities Correspondent & Personal Finance Correspondent
In the media frenzy over the call for $5 gasoline by some forecasters, there is often little explanation about whether this refers to certain locales or the average price nationally. It's a distinction that should be made in order to assess the true impact on the nation's economic recovery.
"The bad news from oil and gasoline prices is not yet bad enough to drive the economy back into recession — and it has probably been outweighed by the stream of other good news, for example, from the labor market and from auto sales," according to a report by IHS economists.
But if there is a serious oil supply disruption in the Middle East and Brent crude prices top $150 a barrel, pushing the national average for gasoline prices to $5, that's a different scenario, say IHS economists. "We would be staring recession in the face," they say. "But we are not near that point now."
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