June 8, 2012:  Oil Prices adjusted for inflation are down significantly from their recent highs.  A slowing global economy plus new supply in the US has oil prices down over 20% in less than two months.  This should be good for the economy.  Unfortunately, oil prices in the past often start their decline at the beginning of a new recession. 

From Chartoftheday.com¹

Today's chart provides some long-term perspective on the price of a barrel of crude oil with a long-term chart of inflation-adjusted West Texas Intermediate Crude. Today's chart illustrates that most oil price spikes coincided with Middle East crises and often preceded or coincided with a US recession. The logic behind this is that a Middle East crisis can potentially disrupt an already tight oil supply and thereby drive crude oil prices higher. Also, rising oil / energy prices can, among other things, increase costs within the global economy’s supply / distribution chain and thereby contribute to inflation which can in turn encourage governments to halt or reduce any plans to stimulate the economy. As a result of a slowing global economy as well as increased global oil production, crude oil prices have declined over 20% since early May alone.