TheUStradedeficitinJunewas$58。

8billionor6。

1%ofGDP。

Alittlemorethanathirdofthatdeficitwasduetooil,or$19。

9billion。

Mindyou,thatwasatanaveragepriceperbarrelof$44。

Todayoiliswellnorthof$60。

Assuminganextra$15dollarsabarrelinAugust,thatcouldmeananotheralmost$6。

5billioninoilandenergyimports。

AndthatisiftheaverageoilpriceinAugustdropsto$60。

Itneedstodropprettyquickifitisgoingtodothat。

Ifoilstaysneartodayslevelthatwouldmeanover$300billionperyeargoingoutsidetheUS。

Thatisanextra$150billionoverwhereitwouldbeat$30oil。

Evenbackingoffto$50,thatwouldtakeanextra1%ofGDPoutofthecountry。

Thatis1%lessthatUScitizenswouldspendonconsumergoods,whichisnotabignumberinthegrandschemeofthings,butisenoughtoslowthingsdownatWal-Mart,whichiswherethegoodoldboysdrivingF-150sbuytheirfoodandothersupplies。

Theruleofthumbisthatforevery$10riseinthepriceofoil,youwillseealossofabout0。

4%ofGDP。

Thustherecentriseinenergyisenoughtoslowdowntheeconomybutnotenoughtopushitintorecession。

Yes,nineoutofthelasttenrecessionshavebeenassociatedwithrisingoilprices。

Butnearlyallofthoseweresupplydriven。

Todaysriseinoilpricesisdemanddriven。

PricesarerisingbecausedemandintheUS,China,Indiaandeverywhereelseintheworldisrising。

Risingdemandisbecausetheworldeconomyisrelativelystrong。

Andthatisagoodthing。

ExcepttherearesignsitmaybestartingtotakeitstollonUSconsumers。

Weseeanewcorrelationwithconsumersentimentnotjustwithhousingandmarketprices,butwhatlookslikethepumppriceatthegasstation。

Wal-Martannouncessofterforecastsasthepriceofgasrises。

Andwithnaturalgasrising,wearegoingtoseemuchhighercostsforheatinghomesthiswinter。

Anotherwayforconsumerstogetsqueezed。

Notalot,buthereandthere。

Now,weneedtorealizethatoilusageasapercentageofGDPislessthanhalfofwhatitwas30yearsago。

Wearemuchmoreefficient。

Butitstillhasaneffect。

Mytakeisthatoilprices,evenwheretheyaretoday,arenothighenoughtopushusintorecession。

Itwilljustslowthingsdownabit。

Asanaside,andforsomethingelsetoaddtoyourworrycloset,myfriendandexpertnaturalresourceanalystandeconomist,DonCoxerecentlywroteaboutafascinatingreportbytheAssociationfortheStudyofPeakOilandGas,whichrefersto1985,whenOPECmemberswerecompetingwitheachothertobeallottedbiggerOPECquotas。

CoxewritesOPEChasalwaysallottedquotastomembersinproportiontotheirprovenreserves。

Kuwaitsgeologistsmusthavehadaprettygoodyear,becausetheirreservesclimbedfrom64bnbblsto92bn。

ButtheKuwaitiswerepikerscomparedtotheirbrethrenintheEmirates,whosaidthat,uponreflection,theyneededtoboosttheirreservesfrom31bnto92bn。

Nottobeoutdone,Iranannounceditsrealreserveswere93bn,upjustatadfromaprevious47bn。

The1985champ,though,wasthesavvySaddam,whowasnotcontentwithdoubledigits:hisreserveswentto100bn,upslightlyfromtheprevious47bn。

AccordingtotheAssociationfortheStudyofPeakOilandGas,thosereservefiguresremaintoday。

ThereareseriousreasonstodoubtthetruthofOPECoilreserves,ortheirabilitytoincreaseproductionfastenoughtokeepupwithprojectedworlddemand。

Oilpricesmaynotbedroppingbackintothe30sorlow40sagain,withoutasharpworldwiderecessionloweringdemandbig-time。

ByJohnMauldin

JohnMauldinispresidentofMillenniumWaveAdvisors,LLC,aregisteredinvestmentadvisor。