Manufacturers Eyeing Potential Effects Of Lower Oil Prices
Posted on Wednesday, January 14, 2015
The International Business Times (1/13, Gallucci) reports that “plunging” oil prices have US manufacturers “bracing for impact” that the downward price trend has already had on energy companies. Lost business from oil and gas providers, however, could present manufacturers a “mixed bag” when balanced against reduced production costs. The story cites NAM Chief Economist Chad Moutray as saying it’s likely that some oil producers will postpone purchases in the next one to three months to see if oil prices rebound. “These prices have fallen very dramatically very quickly, and that has scared some folks,” Moutray said. “That’s obviously a negative in that it adds a level of uncertainty to the marketplace that wouldn’t be there otherwise.”
US News & World Report (1/13) notes that companies that have built up during the US oil production boom, such as steel makers, “are also feeling the fuel’s valuation drag.” The magazine, however, also says that “cheap oil isn’t all bad news for U.S. industry,” with auto manufacturers in 2014 experiencing their best sales year since 2006.
For more news from the National Manufacturers Association, visit www.nam.org.