Low oil prices are beneficial to US economic growth and are expected to add 20 to 30 basis points to real GDP growth rates during 2015-2016, Edward J Sullivan announced during remarks at the 2015 World of Concrete.
However, Mr Sullivan cautioned that this good news for the nation¹s economy does not necessarily travel with the same speed to the construction industry. "Unfortunately, the transmission process from oil price declines to construction activity contains timing lags," said Mr Sullivan.
"The time it takes for oil prices to impact consumer/business behaviour is short, but impacting the
decisions to build is a longer process."
As a result, Mr Sullivan notes that there is little potential for positive impacts for construction activity resulting from lower oil prices that would materialise in 2015, or even during the first half of 2016. In
fact it will have a negative impact on construction projects related to energy drilling and employee wages in energy industry states.
Despite this, job growth and a growing economy will have an overall positive impact on cement consumption this year, the PCA highlights. The association expects only small increases in cement demand arising from low oil prices in 2015 and beyond