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As Oil Drops Below $50, Can There Be Too Much of a Good Thing?

While the stock market’s tense, U.S. consumers are happy
As Oil Drops Below $50, Can There Be Too Much of a Good Thing?
Photographer: Robert Nickelsberg/Getty Images

Oil drops almost $5 a barrel in two days, and the Dow Jones industrial average falls 461 points. Seems like proof that the price of crude is getting to be a problem—as in 1998, when a decline in oil prices forced a Russian default that rocked the global financial system.

Not quite. Cheaper oil is still creating more winners than losers. Far more people live in oil-importing countries than in oil-exporting ones. The U.S., for one, remains a net importer. The travails of its shale oil producers are small compared with the gains of American consumers and businesses that are paying less for gasoline, diesel, jet fuel, and petrochemicals. With fuel prices down, people are driving more miles and buying more cars and trucks.