red states rule
01-08-2011, 10:25 AM
Well, it looks like liberals are starting to notice high gas prices and do not want those high prices to hurt Obama
Almost as surely as dawn precedes daylight, the rising price of oil tends to lead to higher gas prices. With the price of a barrel of oil at around $90, there is increasing concern that expensive fuel will choke off the U.S. economic recovery. At TheAtlantic.com, Lisa Margonelli makes the case that gas, at $3.07 a gallon across the country, is already problematic. And in the video below, my colleagues Henry Blodget and Aaron Task wonder whether high gas prices will hurt car sales:
Nobody wants to see a repeat of 2007 and 2008, when gas prices spiked to above $4 per gallon, as this chart from Gasbuddy shows, and people began to ride horses to run errands. But for several reasons, rising gas prices in 2011 won't have anywhere near the psychological and actual economic effect they did just a few years ago.
First, the U.S. is consuming less gasoline on a per capita basis than it did a few years ago. It may be too soon to argue that we've reached a level of peak gasoline consumption, but it's also clear that we're not nearly as addicted to oil as a transportation fuel as we were a few years ago. According to the Energy Department, growth of motor gasoline consumption stalled out in the middle of the last decade. From a peak of 3.389 billion barrels in 2007, consumption fell in both 2008 and 2009; 2009's total of 3.283 billion barrels was 3.1 percent below the 2007 total. (Data showing the four-week average of consumption reveal that gasoline sales picked up a bit in 2010.)
Consumption has fallen in part because the much-maligned, SUV-heavy U.S. car fleet is getting more fuel efficient with every passing day. For this development, we can thank (or blame) policy, high gas prices, and innovation. The federal standards for mileage of the U.S. auto fleet have been steadily rising, from 26.6 in 2007 to 29.2 in 2010. Changes in policy and the market have made the fleet more efficient.
Remember the 2009 Cash for Clunkers program? The Department of Transportation concluded that "cars purchased under the program are, on average, 19% above the average fuel economy of all new cars currently available, and 59% above the average fuel economy of cars that were traded in." Yes, sales of pickups and SUVs rebounded smartly in 2010. But today's larger vehicles are generally more fuel efficient than their predecessors. Meanwhile, every carmaker has ramped up their offerings and sales of fuel-efficient cars, including the Chevrolet Volt, which I drove in November. As these great charts from WSJ.com show, some carmakers that specialize in gas-sippers made big gains in 2010: Nissan and Kia both reported sales gains of 18 percent, while Hyundai saw a 23 percent gain. Hybrid sales, a high-cost path to greater efficiency, are still off their 2007 peak. But there are many more hybrids on the road now. More than 290,000 hybrids were sold in calendar year 2009. In 2010 Toyota alone sold 189,147 hybrids. Meanwhile, the Hummer — like its most famous driver, Arnold Schwarzenegger — has left the public stage.
http://finance.yahoo.com/news/Don-Sweat-3-50-Per-Gallon-Gas-dg-3085476876.html?x=0
Almost as surely as dawn precedes daylight, the rising price of oil tends to lead to higher gas prices. With the price of a barrel of oil at around $90, there is increasing concern that expensive fuel will choke off the U.S. economic recovery. At TheAtlantic.com, Lisa Margonelli makes the case that gas, at $3.07 a gallon across the country, is already problematic. And in the video below, my colleagues Henry Blodget and Aaron Task wonder whether high gas prices will hurt car sales:
Nobody wants to see a repeat of 2007 and 2008, when gas prices spiked to above $4 per gallon, as this chart from Gasbuddy shows, and people began to ride horses to run errands. But for several reasons, rising gas prices in 2011 won't have anywhere near the psychological and actual economic effect they did just a few years ago.
First, the U.S. is consuming less gasoline on a per capita basis than it did a few years ago. It may be too soon to argue that we've reached a level of peak gasoline consumption, but it's also clear that we're not nearly as addicted to oil as a transportation fuel as we were a few years ago. According to the Energy Department, growth of motor gasoline consumption stalled out in the middle of the last decade. From a peak of 3.389 billion barrels in 2007, consumption fell in both 2008 and 2009; 2009's total of 3.283 billion barrels was 3.1 percent below the 2007 total. (Data showing the four-week average of consumption reveal that gasoline sales picked up a bit in 2010.)
Consumption has fallen in part because the much-maligned, SUV-heavy U.S. car fleet is getting more fuel efficient with every passing day. For this development, we can thank (or blame) policy, high gas prices, and innovation. The federal standards for mileage of the U.S. auto fleet have been steadily rising, from 26.6 in 2007 to 29.2 in 2010. Changes in policy and the market have made the fleet more efficient.
Remember the 2009 Cash for Clunkers program? The Department of Transportation concluded that "cars purchased under the program are, on average, 19% above the average fuel economy of all new cars currently available, and 59% above the average fuel economy of cars that were traded in." Yes, sales of pickups and SUVs rebounded smartly in 2010. But today's larger vehicles are generally more fuel efficient than their predecessors. Meanwhile, every carmaker has ramped up their offerings and sales of fuel-efficient cars, including the Chevrolet Volt, which I drove in November. As these great charts from WSJ.com show, some carmakers that specialize in gas-sippers made big gains in 2010: Nissan and Kia both reported sales gains of 18 percent, while Hyundai saw a 23 percent gain. Hybrid sales, a high-cost path to greater efficiency, are still off their 2007 peak. But there are many more hybrids on the road now. More than 290,000 hybrids were sold in calendar year 2009. In 2010 Toyota alone sold 189,147 hybrids. Meanwhile, the Hummer — like its most famous driver, Arnold Schwarzenegger — has left the public stage.
http://finance.yahoo.com/news/Don-Sweat-3-50-Per-Gallon-Gas-dg-3085476876.html?x=0