2015: The Year of Change
2014 is now a dwindling memory as we look towards the possibilities of 2015. The year has begun not only with a bang from celebratory fireworks but with a sudden plunge in the FTSE100 as oil prices drop to their lowest in over 5 years to around $50 a barrel (Source: The Financial Times). For end users both domestic and commercial this sudden drop has been met with welcoming arms as 2014 saw the stress of energy becoming an all too real problem within the United Kingdom.
2015 looks to be the year of change, growth, prosperity and generally happier times for all of us. This has of course started with the sudden drop in oil price, which has led to the drop in fuel price, which has helped both domestic and commercial consumers. Could this also lower energy bills as well?
As well as the FTSE100 being damaged by the fall in oil price, this could also have a significant impact on a country’s economy. If the country is a large exporter, then you can expect that the income for that country would be negatively impacted as the value of their exports will drop, which will mean that their government would have less money for their citizens. For those countries that are not oil exporters, then expect to see a larger amount of disposable income with your citizens, which will mean they will be able to the boost the economy of many other sectors, with the extra money. Therefore, this demonstrates that lower oil prices can benefits as well as hinder economies depending on their structure (Source: Market Watch)
It is worth noting that decreasing fuel prices will mean that the general population will have more disposable income. This means that other industries could see a boost in sales. This fall in fuel prices has come at the best of times, as wages have remained stagnant and the standard of living is increasing especially in the United Kingdom. In 2014, we saw energy prices rises that saw a lot of people stressed and worrying about their financials. This has lifted a weight from their shoulders ever so slightly.
This price drop will not last forever and it is best to take full advantage of it whilst you can. These prices will more than likely creep or rocket back to their previous position; this is because gas and oil is an expensive commodity. They are of limited supply, which will ultimately mean that the price will rise due to the scarcity of the resource. It may however, drop further in price before it starts to rise again.
Organisations could renew their contract now and have lower prices for longer. So if you are a business or domestic consumer it could be time to look for a new energy contract and take full advantage of the drop in price.