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How Lowering of Gasoline

Prices Impacts Economy


By: Rachel Asman
5th Hour
Crude Oil
Unrefined petroleum
Made into hydrocarbons,
diesel, gasoline, heating oil, jet fuel,
kerosene, and petrochemicals.
Fossil Fuel that can be found around the
world.
Has a direct effect on the price of
gasoline.
How Crude Oil is Converted Into
Gasoline
Crude Oil is converted into gasoline through a
very complex process.
The Oil is extracted out of the ground by drilling
wells underground.
It is then loaded into containers/barrels and
shipped to many refineries worldwide.
When it arrives to its refinery, it is separated into
many useful components.
Chemicals break down the molecule components
into many new products.
In every barrel of crude oil around the world,
about 47% is used to make gasoline
Ratio of Product

Products Made from a Barrel of Crude Oil

Asphalt

Liquefied Petroleum

Jet Fuel

Other Products

Diesel Fuel & Heating Oil

Gasoline

0% 10% 20% 30% 40% 50%


Why the price of gasoline has
dropped downward
SUPPLY AND DEMAND
Economics in foreign countries have effects
on the United States gasoline prices.
Economics in developing countries are
weak so demand for fuel is lagging (New
York Times)
United States domestic production has
nearly doubled over the last several years,
pushing out oil imports that need to find
another home.(New York Times)
Over production of gasoline due to energy-
efficient vehicles.
CR
UD
E
OIL

Production vs. Price


Consumer Income
In Favor
Lower- income Opposing
a) Students High Income
b) Minimum a) Upper class
Wage b) Executives
Fixed-Income
c) Professionals
Retiree Retirees with
Investments
Business Opposing
All oil companies
In Favor
a) NYT; Shell, BP, laid
Transportation off, cut payroll to
Airlines save costs
Ships b) NYT; Smaller oil
Truck companies are in
companies(diesel) worse shape
Freight companies ) Alternative energy
companies
Home/Environment
Homes with heating oil
More needed production, more
pollution, more pollution, more
animals/outdoor environments
affected.
Random Facts/Statistics
As the oil stocks in the stock market
decline, all aspects of retail consumer
spending increase.
Gas prices are 5 percent of total
consumer spending.
The Unites States accounts for 44% of the
worlds gasoline consumption.
One gallon of gasoline has about 31
millions calories.
Other Facts(New York Times
and ETCNBC)
250,000 oil workers have
lost their jobs
Approx. $34 a barrel of oil
Regular gas now averages nationally to
under $2 a gallon
U.S drivers are saving $700 million a
day
Tier 2 Vocabulary
Extracted: The action of taking out
something
Refinery: An industrial installation
where a substance is refined.
Fixed-Income: An income from a
pension or investment that is set at a
particular figure and does not vary or
rise with the rate of inflation.
Aspects: a particular part or feature of
something.
Tier 3 Vocabulary
Petroleum: A liquid mixture of
hydrocarbons that is present in certain
rock strata and can be extracted and
refined to produce fuels including
gasoline, kerosene, and diesel oil.
Kerosene: A light fuel oil obtained by
distilling petroleum, used especially in
jet engines and domestic heaters and
lamps and as a cleaning solvent.
Petrochemicals: A chemical obtained
from petroleum and natural gas.
Discussion Questions
1. One gallon of gasoline is about 31
calories. True or False?
2. Is crude oil a fossil fuel?
3. What is the product that is most often
made from crude oil?
4. The upper class is in favor of the rise
in gas prices. True or False?
Bibliography
http://
www.businessdictionary.com/definition/crude-oil.html
https://en.wikipedia.org/wiki/Extraction_of_petroleum
https://
www.google.com/search?q=barrel+of+crude+oil
&espv=2&rlz=1C1OPRB_enUS592US593&source=lnm
s&tbm=isch&sa=X&ved=0ahUKEwiMtPyQ89TKAhUDpR
4KHdr3BkkQ_AUIBygB&biw=1280&bih=699#imgrc=5
L6S4CfnIChwkM%3A
http://www.kickassfacts.com/25-kickass-interesting-fac
ts-about-gasoline-and-oil
/
http://
www.nytimes.com/interactive/2016/business/energy-en
vironment/oil-prices.html
http://
www.cnbc.com/2016/01/29/a-us-cheap-gas-rift-as-stu

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