Economists: $100 Oil Won't Derail US Economy

CBS Dallas/Fort Worth

February 25, 2022

Russia’s invasion of Ukraine has sent oil futures above $100 a barrel for the first time since 2014 and will probably bring $4-a-gallon gasoline to much of the US. But it won’t be a major drag on American economic growth.

Economists project that at most the nation’s gross domestic product, the broadest measure of its economic activity, will have a few tenths of a percentage point shaved off its growth rate. With the economy growing very strong — GDP had its best growth since 1984 last year — America is expected to weather those higher prices just fine, even if drivers are grumbling. Currently the statewide gas price average for a gallon of regular unleaded fuel in Texas is $3.21.

The positives and negatives for the US economy from an oil price hike come close to balancing each other out, noted Paul Ashworth, chief North American economist for Capital Economics.

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