Do rising gas prices REALLY affect us all that much?

[Cheeky]

can somebody explain why we never see a reprieve in the gas tax. isn't this a flat tax? why don't localities cut the rate when gas doubles in price over a couple year span?

frankly, i would like to see a variable tax rate for fuel. suv and high consumption vehicles should be penalized for hiking up consumption (work use vehicles aside).

[Jeffrey Schronce]

frankly, i would like to see a variable tax rate for fuel. suv and high consumption vehicles should be penalized for hiking up consumption (work use vehicles aside).

Frankly, I should get a discount for buying a larger volume and causing the credit card fees charged for the sale to be lower % of the transaction fee.

[djmcheme]

The ONLY way new technologies will ever be discovered is if their is financial motivation. As long as we can get gas for next to nothing then no motivation exists to explore new technologies. I see the increase in gas prices as a necessary evil and a 1st step towards decreasing our dependance on other countries for our energy supply.

[Pappy]

This is somewhat political, but we all seem to be on the same side.

Summer = Vacations = Higer gas prices (Same seems to happen around Thanksgiving and Christmas)

I underestand when the cartel raises the price of a barrel of oil, the price of gas is going to rise. But why on the gas that is already in the tanks at the stations? When the price of crude goes down, they don't lower gas prices until the lower priced oil is refined and ready for sale.

[Knottscott]

It makes a much bigger difference than $3 a week for me. I probably wouldn't notice an increase of that magnitude much. Our van has a 35 gallon tank. A complete fill up runs over $100. We fill up about every two weeks....so gas is up more like $15/week with the van alone.

Gas is up 30% from 2 months ago, and over 75% from just a couple of years ago. Energy prices are up a ton, medical costs are way up, shipping costs are up, taxes are up, tuitions are up.... income is not . We've been practicing a lean budget in our house for years and we're running out of places to squeeze from, so yep...it hurts.

[RayintheUK]

For info (and maybe another perspective), diesel fuel is about $7.20 per US gallon over here right now. Petrol equates to $6.85 per US gallon.

Ray.

[Black wallnut]

It is a two edged sword. For us it really hurts! Last year at this time I was commuting ~90 miles a day, so had to fill up every fourth day. An increase in just a few months to when gas was over $3/ gal equaled the price of 6 or 7 gallons of milk for the children.

The other edge of the sword is fuel surcharges. When prices are high fsc is also high boosting my companies profit. When they go down, and they do go down , we make less of each load we broker out. Fuel Surcharge is based upon the national average pump price of diesel. It changes weekly but does not always match gasoline prices. Diesel prices are impacted by heating oil and weather. Demand for diesel is also closely related to shopping patterns of consumers. I.e. there a more trucks driving more miles spring through Christmas than Jan - Mar.

On the west coat we get the highest prices because of suppy and demand. The problem is too little refining capacity, which is not likely to change any time soon. No one wants a new refinery built in their neighborhood. The low gas prices of yesteryear did not generate enough profit for investors to build new refineries. Now that profits are up it might be possible if they could find a location and if environmental impact statements, and if local building codes, and if local citizens would only allow it. Who wants one in their neighborhood? After that hurdle how to get the finished product to distribution centers? Rail, truck, pipelines? It is an endless circle! I'm thinking high prices are here to stay and there is nothing we can do about it, at least not as individuals.

[jackellis]

I work in the energy business - power rather than oil - but I still watch this stuff pretty carefully.

The increased cost of fuel does hurt, and it's very much like a tax in that it moves money from one sector of the economy to another. However I don't believe the conspiracy theories because cartels don't work all that well. there's to much temptation to cheat, most of the world's oil supplies are controlled by governments rather than businesses, and there are too many market actors Even OPEC members had a great deal of difficulty imposing production discipline until world demand for oil caught up with supply.

Someone mentioned the difficulty building refineries. Another problem is that there are more than a dozen different blends of gasoline used in various locations across the country. If they were all the same, consumers in places like Georgia and Texas would pay a bit more but consumers in Chicago, New York and California would pay less. If you can find a place to build one, a new refinery costs a couple billion dollars. With all the talk about switching away from petroleum fuels, what investor in his right mind is going to build a new refinery that might not every pay for itself? Not me.

You might be surprised to know that the US imports a million barrels of gasoline a day, and the amount is growing. That's about ten percent of total daily motor fuel use and equal to about 3 million fillups for a typical medium-sized sedan.

I don't like the fact that gasoline is expensive either, but I try to do some simple things to minimize my usage - bike when I can, combine trips, drive at the speed limit, keep my tires inflated, go easy on the accelerator. Next time I have to go to Sacramento I might take the train instead of driving 240 miles round-trip. Although not everyone has the means to do this, I also partially insulated myself from caring about whether gas prices go up by putting a few shares companies that produce oil and refine it in my retirement account.

There's still a lot of oil in the ground but there isn't enough production capacity and most of the fields that are controlled by private companies are in decline. The Saudis, Iran, Russia and Nigeria can pump more with some investment, but they don't have much incentive to make those investments if it means prices could crater as a result. Personally, I'm not particularly inclined to help them get richer, either. If for some reason our government was able to lower the price of gas, people would just use more of it. That's not terribly helpful when oil production capacity and oil refining capacity are constrained. So it turns out the absolute best way to push the price of gasoline down is to...use less of it.

[Ed62]

I'm retired, and we put less than 8,000 miles per year on the car. But rising gas prices definitely affect us. Everything at the grocery store has gone up, as well as most everything else. We just got a notice that garbage pickup is jumping in price again, and on top of the monthly rate, they add a fuel charge! I haven't made enough money in the last 5 years to be obligated to file income taxes. So, yeah, it makes it harder for us. It's not over reacting in my book. We've had the technology for over 50 years to make solar run automobiles, but someone is powerful enough to keep a lid on it.

Ed

[Alex Franke]

I think we need to figure out how to burn coal more cleanly -- we have like a zillion tons of that stuff. Nuclear is also great -- aren't the French almost 100% nuclear power? Only problem there is the spent rods. (Hmmm... how about backyard reactors? You could use the hot waste water for your shower instead of a water heater!)

Maybe not a conspiracy, but there certainly is a LOT of money riding on the oil infrastructure here...

I think the only people that should get a surcharge are those that drive hummers and never take them offroad.

[Tom Slick]

Although none of us enjoy it, rising gas prices don't really affect most people enough that there is a real issue. when you decide not to take a trip, start riding a bike because you can't afford gas, start riding public transportation, combine trips and not "go to town" as much then it has affected you. as long as you continue to drive your vehicle all over the place at 20 mpg it hasn't really affected you.
when it becomes difficult to justify the cost of driving does it really does affect you. until then we just fork out some more easy $$ for convenience. think about the economic decisions that "the greatest generation" made about driving back when gas was "cheap".

[Alex Franke]

when you decide not to take a trip, start riding public transportation, combine trips and not "go to town" as much then it has affected you. as long as you continue to drive your vehicle all over the place at 20 mpg it hasn't really affected you.

Funny you should mention this -- I take the bus to work regularly and I have for about seven years now. I think we're the only family I know that owns a single car -- just one safe (and heavy) car for all four of us. Last time I "went to town" I got a haircut with my son. We took the bus. =)

Actually I highly recommend public transportation if it's available even if you do have two cars. It's a great way to catch up on reading, and busses often get special lanes through traffic (Back in San Diego it took me less time to get to work on the bus than if I drove!)

[Hoover]

[QUOTE=lrr;265040]

I assume this is just for perspective -- you certainly cannot blame Bush for this! Remember, it was (and continues to be) the Dems that block drilling in ANWR, and all the offshore drilling in California. Plus, if we'd allow nuclear power plant construction in this country, we could at least wean our power plants off fossil fuels in the next decade.

If the French can build power nuclear plants, then we certainly could do the same.

I wasn't trying to be political, but each W and Cheney are linked to big business oil. If it strikes a nerve, so be it. History will judge the 00 decade.

[Russianwolf]

I will point out another impact that hasn't been brought up yet.

Ethanol is what is being pushed to "reduce our oil dependance" right now. But there are some problems. Ethanol currently comes mainly from corn as I'm sure all of you are aware. To make more Ethanol, they have to use corn that normally goes to feed stores. 2 years ago a 50lb bag of whole corn was $4.85, today it's $7.28 (50% increase). Now I buy corn to feed deer in our yard, but what about the ranchers that buy corn to feed their cattle. To make the same profit off their livestock they have to sell that $1000 steer for $1500 now. The butcher then hase to sell the meat for $2000 instead of $1500. etc. etc.

When you add in the fact that Ethanol has less energy content, you really start seeing the futility of going far in that direction.


I honestly can't wait to see $5/gal gas. That's what it's going to take before they start putting more efficient cars on the market.

The Toyota Prius gets 60mpg with it's gas/electric hybrid. But ask yourself this, how much would it get if it were a deisel/electric hybrid. There is a reason that over half the cars sold in Europe are deisels.

I'm not saying Deisel is the end solution, but it's better than where we are right now.

[Perfidiajoe]

Where did you get the 10% number?