week 4

Introduction

Business Cycle

Oil and gas extraction industry is a lucrative business. Like any product the demand goes up and down in this industry as well. Many households, businesses, governments, industries rely on oil and natural gas for their daily operations. The following graph depicts how the oil and gas industry from 2005 through 2012 (BEA, 2014).

The X-axis is the years from 2005 through 2012. The Y-axis is the GDP value in billions of US dollars. The industry has gone through peak in 2008, then a recession in 2009 and a recovery there after.

Graph Comparison

Conclusion

It is clear after the study of rise and fall of gas prices that global natural disasters occur in which make prices go up significantly. Just within the last decade we saw prices rise up to a high of 4 dollars a gallon. Another point to consider is natural gases prices depict the season change as well. The reason being the cost of resource gas is contributed by crude oil. By marking up prices on gas it will cause tracking of the crude oil fluctuations. One thing to keep in mind with North Americans today is the difference in the automobiles within the auto industry. The auto industry is finding ways to produce cars that are more fuel efficient on gas. The cars cost a little more however the end result is the American owner is saving hundreds of dollars on gas. In conclusion, gas prices have been lowering in the favor of the consumer within the past six months; with prices falling on an average of 25 percent since the summer of 2014. The demand of the production within the United States has helped bring an average cost of gas to a little over 3 dollars a gallon if not lower across the United States.

Oil and gas extraction 2005 2006 2007 2008 2009 2010 2011 2012 260.60000000000002 271 293.60000000000002 395.4 223.6 289.7 347 352.1