Oil company cutbacks may raise gas prices down the road
March 4, 2009 at 1:38 PM EST - Updated June 30 at 8:02 PM
NATIONAL (USA Today) - Americans battered by the recession have found modest consolation in low gasoline prices, a salve that's likely to last as long as the economic downturn.
But the oil industry is quietly sowing the seeds for a sharp run-up in gas prices once demand recovers.
Oil companies are slashing new investment and production far more sharply than analysts projected just a couple of months ago, a strategy analysts say could lead to shortages and higher gas prices when consumption rebounds. And, analysts say, a standoff between the oil giants and their suppliers over the cost of rigs, labor and other expenses could prolong the investment slowdown.