With the election days away and gas prices down by nearly a dollar in the past month, conspiracy theories are flying across the web about an effort by Republicans to manipulate prices in order to win the election. But the real reason for the dive in gas prices is nothing more than a bit of Economics 101.
To compound the effect, here in the U.S. people just aren’t driving as much as they used to. Whether it’s because of tighter budgets or rising unemployment leaving less people who need to drive to work, the effect is clear – in August, Americans drove 15 billion less miles than they drove a year ago.
Late last week, OPEC, the cartel of oil-producing nations, announced a plan to reduce oil output to get prices at the pump back on the rise. But prices barely budged, exemplifying just how much economic factors are behind this extraordinary move in oil.
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