It is not good news for all when we hear news of oil price slumping.
Just think of countries who rely heavily on extraction of oil as their source of revenue from royalty payment and taxes. Some oil wells will have to be abandoned if the price to extract is higher than the price to sell per barrel. There are going to be cost cutting measures that will affect government spending as their budget surpluses from oil revenue dip.
The news also shake the job security of staff in many companies that are related to the oil and gas industry. Those directly affected are contract staff, highly paid expatriates, contractors, suppliers and service providers to the industry.
Job loss means wage loss and with news of such layoffs, many staff from the oil and gas industry will face difficulties in getting their loans approved. People start controlling the way they spend their money and this will ripple down to affect the other industries, such as, food, real estate, etc.
We will also see less plastic material being collected for recycling because plastics are made from oil, so, it is now cheaper for manufacturers to buy freshly made plastic.
Want to know more about the the ripple effect in the oil and gas industry? Read, "The Price Of Oil: A Comprehensive Guide To Understanding Oil (Oil prices, Crude oil prices, Shale Oil, Gas, Oil and Gas, Consumer Economics, Oil Refinery, Oil and Gas Industry, Oil Well, Oil) by Julien Chartier.
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