One of the most glaring good news/bad news situations we have on Wall Street in regards to the airline industry is, of course, the issue of oil prices.

The generally accepted economic theory is that when the economy tanks, oil prices should drop because it is expected that lower economic activity means lower demand for energy products.

Unfortunately, while many kept thinking this scenario would happen in 2007 — given the growing banking, real estate, and mortgage mess — it didn’t.

But now, at least for the time being — it does appear that the markets may finally be thinking, “Okay, this is really going to be a global slowdown –and if it is a global slowdown, oil prices need to come down.”

That’s the good news. Of course the bad news is we would not be having this conversation if the economy was rockin’ and rollin’.

Then again, with oil prices where they are now — one has to wonder if the rules regarding this economic  situation have not been somewhat modified over the last few years. In other words, oil is still, even after a week or so of continued declines, trading at $86 a barrel.

But I digress.

The long and the short is that oil prices continued to drop today. And hey, we’ll take it. At the close of trading, crude oil was at 86.99, down more than 2% on the day.