Americans think worst of 2008 oil spike over

WASHINGTON - Most Americans think that the worst of the fuel price spike that pushed gasoline above $4 per gallon has passed, but they have little hope that the housing market will stage a swift recovery, according to a Reuters/Zogby poll released on Wednesday.

By (Reuters)

Published: Wed 20 Aug 2008, 7:25 PM

Last updated: Sun 5 Apr 2015, 11:55 AM

The economy has jumped to the top of voters' concerns this election year, eclipsing the Iraq War, and that has put the housing bust and rising inflation squarely in the spotlight.

The poll of 1,089 likely voters found that just under 13 percent thought gasoline prices would rise a lot between now and the end of the year. About one quarter thought prices would rise a little, while one in three thought they would drop a little and 18 percent said they would stay about the same.

The survey was conducted Aug. 14-16, when oil prices had come down some $30 from a July 11 peak above $147 per barrel, and the national average price for a gallon of gasoline fell back below the psychologically significant $4 mark.

Pollster John Zogby said the swift rise in fuel prices earlier this year had fundamentally changed U.S. consumer behavior, and a pullback below $115 per barrel was not sufficient to alter that.

"The lines are not forming to buy Hummers," he said, referring to the big luxury trucks that are notorious for their poor fuel mileage.

Mounting costs for necessities like food and gasoline have strained household budgets, leaving less money for spending on discretionary items. That has put a dent in the U.S. economy, which was already struggling to overcome the housing slump and financial market turmoil.

Most see more housing pain

On the housing front, there was little hope that the market was close to recovery despite many months of price declines.

Of those polled, two-thirds thought housing prices in their area would stay about the same or fall in the next year. The responses were similar to those given in a Reuters/Zogby poll conducted in January. Since then, home prices have dropped sharply in many parts of the country.

"This is not an optimistic crowd," Zogby said. "Even though there's a sense that gas prices have topped off, perceptions of the economy are not based on one thing alone. There's a funk."

The economic malaise is apparent in consumer confidence figures that show the mood is as dark as it was during the back-to-back recessions of the early 1980s. That is affecting the way voters think about government's performance, and the presidential election in November.

The poll found that 84 percent rated U.S. economic policy "fair" or "poor." Less than 1 percent called it "excellent."

When asked which presidential candidate would best manage the economy, 49 percent chose Republican Sen. John McCain, while 40 percent selected Democratic Sen. Barack Obama.

The poll had a margin of error of plus or minus 3 percentage points.

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