How quickly our perspective changes…
According to CNN, oil prices have ‘retreated’ to only $107 and change on news of a surprise jump in oil inventory. A few months back oil at over $100 was a sign of economic doomsday… now it’s just business as usual. The number 100 is one of those big psychological barriers that looks really nasty, but once breached it loses a lot of its ability to inspire fear.
In a related news story about spiking gasoline prices, this article notes that prices will spike in late spring, and then return to a more normal level of around three dollars per gallon. The underlying message: $3 gasoline is now the new baseline for gas prices in the eyes of economists… it is no longer the high end of the price spectrum.