Pleasing prediction

The Gas Stations Owners Association predicts a 10-12 per cent drop in fuel prices next month, reflecting the sharp drop in the price of Brent crude, which is now hovering at about $40 a barrel on the world market.

International markets forecast even lower prices for fuel in the upcoming months as there is already a glut in the market due to the refusal of oil-producing nations to curtail their oil production to a level that would push for higher prices for their products.

Jordan calculates fuel prices on monthly basis in order to avoid being surprised by sudden surges in oil prices on the international market. That is only fair.

The prediction of lower prices for fuel derivatives may be a mixed blessing for Jordanians.

On the one hand, car owners, lured by lower prices at the pump, could be tempted to drive around more. This would mean that the traffic situation, already dire, could take a turn for the worse, something that most of us are loathe to witness.

Pushed to an extreme, the thinking goes that more traffic could mean more traffic accidents and an increase in the number of injuries or fatalities, which costs both individuals and the country heavily.

On the other hand, the cost of living and of industrial production is expected to drop as a result of lower fuel prices, a welcome development on all fronts.

Lower production costs help exports, thus serving as a powerful stimulus for the stagnant economy.

Given the high rate of unemployment and the low wages that make many workers barely able or even unable to make ends meet, a lower cost of living and an accelerated economic growth rate will be a blessing.

For the time being, with the new scholastic year just around the corner and related expenses making a dent in families’ budgets, the projected drop in fuel prices is a welcome development.