As Crude Prices Sink, Consumer Hopes Rise

August 6, 2008

(Long Island, N.Y.) Tuesday, August 5th 2008 saw some of the highest trading on Wall Street as the seemingly insurmountable dragon called the oil industry lost a few teeth when oil prices plummeted to a three month low of $118.00 USD a barrel.

Having closed on a substantial 330 point gain, one of the highest gains on Wall Street in the recent four month dry spell caused by astronomical surges in crude prices, investors were feeling a little more confident about the green in their gator.

In a perfect world, this optimism might be justified; but the oil industry’s track record establishes the types of games it likes to play with the mice trapped in its cavernous maw. Most people should be wary when a company’s product drops value so drastically after the company associated with the product just posted record-breaking massive gains.

In addition, there is the disturbing trend of spikes on major holidays followed by strong reductions in product prices right after. This seemingly yo-yo effect is actually more deliberate than it first appears, and has little to do with the oft quoted lame duck defense of ‘Supply and Demand’, as there has never been such a huge discrepancy as this in the market within recent memory.

Seeking practical long-term answers to ‘alternative fuels’ to compete with gasoline, many have heralded Ethanol as a natural alternative to crude. While initially this seems like a great answer for a potential long-term fuel source, it is NOT yet an ideal solution for the average car-owner today, who more than likely has a vehicle that doesn’t run on anything other than standard gasoline.

And those who are perhaps suffering the most at the pump are SUV owners, who currently make up a large share of the domestic automobile market today. The perfect epitome of ‘gas guzzlers’, the SUV is a very necessary mode of transportation for large families, Soccer Moms, Outdoorsmen and anyone whose occupation requires the transportation of a large number of miscellaneous implements to successfully complete their work.

Many SUV owners have, however, due to the escalating gas prices and extremely shaky economy, made the compromise of trying to work with a smaller vehicle in order to stave off gas costs that are equivalent to a payment on their larger vehicle. When this is the SUV owner’s last recourse towards financial stability, they often find themselves in a bit of a crunch, as the negative (albeit accurate) connotations of the vehicle’s consumptive cost shy others away from what in the 90’s was considered a sound investment.

As a result, many SUV owners stop driving the vehicles altogether, leaving them in the backyard to rust or pass the days as an over-exaggerated playhouse for the kids.

At such trying and pressing times as this, a Long Island company like Quick Cash Auto, a local “cash for cars” service, helps offset SUV owners trials with their willingness to buy any SUV right on the spot.

We spoke with owner Brian Keegan whose main offices are located in Copiague Long Island and he had this to say: “It’s clear to see that SUV sales are down - way down… On the lot, at the auctions, and in the industry overall.”

Posted by News LI Editor · Edited by Brianna - Filed Under Money

Have a press release or local story you would like us to review? Let us know about it!

You can Bookmark & Share this page by clicking here:

More Long Island News

News Comments for this Article

2 Responses to “As Crude Prices Sink, Consumer Hopes Rise”

Andrew B. on August 6th, 2008 1:01 pm

I would agree with Mr. Keegan. I am in the same industry as he is and we are buying SUVs left and right. 50-60 Percent of the vehicles we buying now are SUVs or BIG V8s. People’s attitudes and priorities are changing. It’s a different world out there and professional car buyers like Mr. Keegan’s business and mine, Car Cash® have to adapt rapidly to these fluctuations.

- Posted by: Andrew B.
informednetworker.com on August 21st, 2008 1:07 am

Crude Oil Has Hurt SUV Sales…

Many SUV owners have, however, due to the escalating gas prices and extremely shaky economy, made the compromise of trying to work with a smaller vehicle in order to stave off gas costs that are equivalent to a payment on their larger vehicle….

- Posted by: informednetworker.com