Gasoline Prices: 56 years of history
Posted By RichC on June 18, 2006
While attending a graduation party this weekend the initial subject of “the weather sure is nice,” gave way to “the cheesecake is good” and to the high price of gasoline. While attempting to skirt the issue I did not say that perhaps we own too many SUVs or that “Americans are gas hogs,” — no … I applied commonsense and just agreed that prices were high. I tried to explain that the ‘actual’ price of gasoline adjusted for inflation was not quite has high as those remembering 29 cent a gallon gas, but I don’t think it registered.
To illustrate the the Department of Energy’s published numbers take a look at the chart above. Throughout the 1950s and 1960s a gallon of gas compared to income costs us less each year. The price of gasoline, adjusted for inflation, declined over this 20 year span, although it happens so slow that prices were barely noticed — in fact the prices at the pump really didn’t change much. The inflation adjusted change came as the income level of Americans rose causing gasoline to require less of ones income. (of course we began driving and using more gasoline too)
Some of us remember the Oil Embargo of 1973 which was followed by a steep rise in the cost of gasoline as well as a period of inflation. As oil exporation flourished and new oil flooded the markets with more crude oil, gasoline prices headed back down from their highs. Not only was there now plenty of oil, but Americans incomes continued to rise. Eventually the two factors caused the inflation adjusted cost of gasoline to drop to all time lows … just in time for more powerful cars and bigger modified trucks that ‘lovingly’ became known as the SUV.
As we crashed through the millennium burning nearly 180 million gallons of gasoline per day in the United States, demand has started to show signs of passing production. Add hurricanes to the instability in the middle east along with booming econonies in China and India … and we are left with skyrocketing gasoline prices. Today in the US, the average price is above $2.90/gallon. (I should have corrected my chart!)
Of course the graduation conversation didn’t really have me scribbling charts on napkins or standing on my “biodiesel soapbox” — we instead moved to the next light subject … “He sure has grown up fast. I remember when he was …”
😀
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