Oil prices just keep falling and falling.
Today, the global price of crude oil has fallen another $1.57 to settle at the price of $57.88 per barrel. The U.S. price has fallen $1.12, settling at $53.61 per barrel.
Since June, the global supply of oil has outpaced demand, resulting in a steep decline in the price of oil. One consequence of lower oil prices is low gas prices, which have reached record lows in the U.S.
A Bloomberg chart shows that the national average gas price has dropped from $3.67 on July 1 to $2.67 on Dec. 7. In some states, the price of gas has dropped more than $2.00.
While low oil prices are good for everyday consumers, they are not as good for oil companies. U.S. oil producers have slowed production to help increase the oil price internationally.
The Wall Street Journal reports that this is the third consecutive week the drilling rig count fell. Last week alone, 37 oil rigs stopped drilling.
Analysts at Credit Suisse think the trend will continue.
“We think it will fall every week for the next three months,” one analyst told the Wall Street Journal. “We expect the market to lose at least 200 vertical and 200 horizontal rigs, and it could easily be more than that.”
It is expected that the pace of oil production will continue to oversupply the market in 2015. One reason is because OPEC has chosen not to scale back its production.
However, under the Obama administration, the impact of OPEC on the U.S. has been greatly diminished, as U.S. oil imports have fallen and domestic oil production has risen.
A chart from the U.S. Department of Energy shows that U.S. oil production has surpassed imports for the first time since 1995.
Oil prices are on track for the biggest decline since 2008.