Gas Demand Decreases Across US

[Tessa]

I saw on the cover of USA Today that there's been a 6 billion mile decrease in travel across the US vs. mileage by this time last year. If the average car receives 25MPG that's 240,000,000 gallons of gas. At $4 a gallon, that's $960 million dollars worth of gas we haven't bought.

How many gallons are in a barrel? Is it 60? I think I read that somewhere. If it IS 60, then we've cut our usage by 4 million barrels vs. this time last year.

It's a small dent, but it IS a dent, none the less.

Seems like a decrease in demand would at least slow this increase in the price per barrel. We can't be the only country that's decreased usage over the last 6 months; especially considering how wasteful Americans are. I think this aids in the argument that supply vs. demand is not the only factor in this inflation situation.....not to stir the debate again.

 

[WoodMann]

You'd think, bt that's not a big enough dent. There are still too many people like my sister that won't put of the trip to the Kalihari in the Wisconsin Dells via the Suburban just so her 2 kids will think she's cool.............

 

[webbie]

42 gallons in a Bbl.

It is an interesting stat and proof that conservation is the ONLY thing that we can instantly put into practice.

Here is my question - when I heard that stat.....

Can they accurately measure how many miles are driven as opposed to how much gas we all save by being lighter on the pedal, lower speeds, turning the car off at drive-in windows, etc.

I'm not doubting that there is less driving - just that the proper stat might be the fuel use as opposed to miles driven.

Hey, as far as I am concerned, less traffic is a good thing......

 

[Tessa]

Can they accurately measure how many miles are driven as opposed to how much gas we all save by being lighter on the pedal, lower speeds, turning the car off at drive-in windows, etc.

I'm not doubting that there is less driving - just that the proper stat might be the fuel use as opposed to miles driven.

Hey, as far as I am concerned, less traffic is a good thing......

One of my first thoughts was "how did they get that figure?" I'd imagine they probably calculated the amount of gas purchased, used an average MPG rating and calculated miles driven because 6 billion miles sounds a lot more impressive than 240 million gallons. Shock value seems to be the deciding factor in how a story is presented anymore; we want to be awed by what we read/hear.

 

[velvetfoot]

Obviously the high fuel prices are sending the 'proper' signals to the consumer.
Also obviously, higher fuel prices will only enhance 'proper' consumer behavior, especially to we piggish Americans, so therefore it is best to encourage their rise until the 'proper' behavior is realized.

 

[mayhem]

According to Wikipedia as of 2005 there were approximately 247,000,000 vehicles registered in the USA...so a national average of 6 billion fewer miles driven equates to a whole 24 miles per year per vehicle.

 

[WoodMann]

Well I guess this is a baby step in the right direction...................

 

[BrotherBart]

42 gallons of oil in the barrel but only roughly 26 gallons of it comes out of the refinery as gasoline, even less if they are running in distillate mode instead of gas mode. Lots of other stuff in that barrel. Lube oil stock, petrochemical stock, sulfur, residual (asphalt), coke, butane, propane and on and on and on.

Actually more gallons come out of a refinery than go in. When ya heat the stuff up and rearrange the molecules the volume increases.

 

[BrotherBart]

According to Wikipedia as of 2005 there were approximately 247,000,000 vehicles registered in the USA...so a national average of 6 billion fewer miles driven equates to a whole 24 miles per year per vehicle.

With my 454 3/4 ton Suburban it equates to about six blocks less a year.

 

[begreen]

Hmm, that Suburban would make one helluva smoker. Pipe the old Sierra through the back doors and you could smoke a year's worth of meat in one pass.

 

[Redox]

I thought the thread was about NATURAL gas. I haven't bought gasOLINE in months...

CNG=$2.40/gal equivalent here, only $0.73 in Utah!

Chris

 

[fraxinus]

Actually, this decrease in gasoline consumption is pretty impressive when you consider how quickly it's come about. At this point, perhaps most of it is attributable to increased use of public transportation where that is available, but it's interesting to note that the percentage decrease in consumption almost exactly mirrors the decline in traffic on the Maine Turnpike so far this spring. This in a state with very few public transportation options. A further dramatic indication of where things are headed is the phasing out of low mileage vehicles by Ford, GM and others. Ford, for example, can't produce enough Focuses (Foci?) to meet demand, but will drastically reduce production of F250 and F150 pickups - their previous best sellers.

 

[TMonter]

As I've been saying for years, the market responds faster and with better results than any government solution. These high prices will drive the development of innovation quicker than any proposed government solution. Now if only we could get the military spending/subsidizing of oil removed from the equation we'd be set.

There is a reason Ford/Chevy/Chrysler is in the toilet and the government should not bail them out. Let other automakers take up the slack and replace them.

 

[fraxinus]

TMonter: The decrease in gasoline consumption is certainly a vivid example of market forces bringing about rapid change. I'm not so sure, however, that these forces always operate faster and with better results than government action. Some examples that come quickly to mind: Would we not be in a better position today if mandated mileage standards circa 70's and 80's had been maintained and even strengthened? Would we not also have been better off if we had established a floor price for gas through taxation (which helps support public transportation) as most European countries did? I can't quite imagine how strictly market forces could have brought about seat belts and their tens of thousands of saved lives. Finally, Vermont's plans for the coming winter posted elsewhere on the site seem to me an excellent example of things government can and should do.
I do agree completely that there should be no Federal bailout of Ford, GM or any other auto company.They can adapt or perish. American corporations and their Congressional enablers have, however, become so addicted to govermental largess I expect they will all be arriving in Washington with their hands out any day now. If we had the same mindset as today when the first Model T's began rolling off the assembly line, we'd probably still be paying subsidies to blacksmiths and buggy makers.

 

[webbie]

Oil and energy are NOT free markets, not by any stretch of imagination!

If we all were allowed to grow pot in our back yards and then sell it to whoever we wanted, that may be a relatively free market.

But when you are a monopoly or state-owned or backed industry - as we can say ALL oil companies are, the market is nowhere near free. When the price of admission is in the tens of billions of dollars, no one can say the the dude with only a million has a chance to compete in the "free" market.

Once again, T, to a Hammer everything looks like a nail! If you cause people pain (or lack of pleasure), they will respond quickly! That is the only dynamic at work. If you told people right now that we could lower the price of gas to $2.00 a gallon by allowing power plants to double their emissions (which would, in turn, kill many more people), they would vote yes! That is not a free market. That is mob behavior. Survival. Pleasure seeking. Conditioned response.

Market Forces are a whole different thing than free markets.

Sounds more like Behavior Science than anything to do with free markets.

 

[BrotherBart]

When you have anybody involved in a process that didn't either make it, processes it, transport it, distribute it or consume it, free market principles don't apply. Demand elasticity hits the wall when somebody is allow to tie knots in the elastic.

 

[TMonter]

Oil and energy are NOT free markets, not by any stretch of imagination!

Never said they were, just pointed out that markets respond faster and more appropriately than government.

Some examples that come quickly to mind: Would we not be in a better position today if mandated mileage standards circa 70’s and 80’s had been maintained and even strengthened?

Not really. The harm to consumers may have been just as great, maybe more so. What should have been done is force producers to internalize all the costs and prevent them from offloading external costs onto taxpayers.

If you cause people pain (or lack of pleasure), they will respond quickly! That is the only dynamic at work. If you told people right now that we could lower the price of gas to $2.00 a gallon by allowing power plants to double their emissions (which would, in turn, kill many more people), they would vote yes! That is not a free market. That is mob behavior. Survival. Pleasure seeking. Conditioned response.

It is a free market when businesses must pay for all the costs associated with their business. You are specifically using a loaded example that is invalid because it is in fact framed as something it's not. Yes people often take the easiest path, but that does not make a free market bad. That is where the government is supposed to step in as a referee and keep all parties honest.

 

[webbie]

I thought I was a Utopian!
Government as a referee - eh?

Let's see - would they care more about a citizen or a corporation who flew them around in private jets, financed their campaign, provided them every luxury and VIP treatment?

Of course I agree that markets work! Slave markets work, heroin markets on the street corner work, black markets work, gray markets work....etc, etc.

The myth, as I see, is that anyone thinks there is something special about this - it's become a sort of religion!

As far as a loaded example, we are talking about Energy, aren't we? It is what all markets are based on.......in the end. You say that is a loaded example, yet this is EXACTLY the thinking that the "drill everywhere" ethic is based on...the perception that it will alleviate short term pain.

I think we can agree on one thing - if there is not a financial or major (jail, etc.) reason for corporations and people to act in an honorable way....then they will not! At least not in the marketplace.

Not trying to be ornery because I think we probably agree that the market, free or not, needs long term planning which takes into account all the various angles.

Listen once again to those Enron Energy traders laughing at 10's of millions of suffering people! Then tell me we should punish those couple dozen traders - and how that will help the 10's of millions that were hurt. That is the problem of culpability. You cannot get blood from a stone. The traders that are making big $$$ right now will NEVER pay the money back to the consumers who they are making it from.

 

[Tessa]

So Web, how do you feel about the "windfall profit tax" suggested for Big Oil?

 

[webbie]

No windfall profits tax, but:
1. Do not lower corporate taxes until and unless budget is balanced (a long way ahead!)
2. Remove or reduce current tax subsidies for domestic drilling - these were put into place to make more domestic drilling happen when oil was $30 or below. Now that it is over $100 this is certainly not needed....plenty of incentive in the oil itself.

The way I hear it, the Congress has been trying to remove those subsidies and have the money used for renewable energy crash programs, but the GOP and McCain have voted it down numerous times.

You have to be real careful about the language in these news stories - for instance, the Dem plan is said to have a "Windfall profits tax".....which is true ONLY if the companies "failed to reinvest their profits in new exploration activity or renewable energy projects." How can the same folks that want to open up every square foot of the coast for drilling...then complain that a company who does not actually drill or invest will be taxed?? Doesn't make sense....

Another interesting use of words is that the bill "raises taxes on oil companies". That is true only if you think this way - the government sent you out a $600 stimulus check this year. If they fail to do so next year because the economy improves greatly, is that a tax increase?

We need a crash program on alternative energy - even McSame is coming up with new expensive programs every day - like today he wants to give 300 million to someone to build a battery and $5,000 to the automakers for each clean car sold...

BUT, I think he forgot one thing - we have to pay for these efforts! The Bills which have been voted down use the removal of those tax breaks to PAY for the renewable stuff. So once again, we have Bizzarro Backwards world......the GOP jumping up and down about tax increases while funding programs which vastly increase the debt and deficit! I'm not saying the Dems have it perfect, but I would rather have an effort be financed then just printing money - we see now the effect of printing money (it is worth less).

 

[TMonter]

Listen once again to those Enron Energy traders laughing at 10’s of millions of suffering people! Then tell me we should punish those couple dozen traders - and how that will help the 10’s of millions that were hurt. That is the problem of culpability. You cannot get blood from a stone. The traders that are making big $$$ right now will NEVER pay the money back to the consumers who they are making it from.

Except Enron happened because of government meddling with the market, not because of it. In an open market system what Enron did would have never been possible.

I think we can agree on one thing - if there is not a financial or major (jail, etc.) reason for corporations and people to act in an honorable way....then they will not! At least not in the marketplace.

Which is why a free market works better than government regulation. If corporations are forced to internalize costs by enforcement through courts and by people in the marketplace it keeps them honest.

Not trying to be ornery because I think we probably agree that the market, free or not, needs long term planning which takes into account all the various angles.

Which is not done better by government. Market driven solutions are always better than government ones. (Assuming noone is being defrauded)

Note that when I talk free market system I'm taking a system with minimal or no regulations outside of the prevention of companies/individuals using fraud or force.

 

[RedRanger]

[quote author="TMonter" date="1214268969


Which is not done better by government. Market driven solutions are always better than government ones. (Assuming noone is being defrauded.

So nice to be an assuming Libertarian--bye the way you spelt none incorrectly.

Many things are better done better by government for the common good. (ASS) suming that private individuals will always step up to the plate, is extremely naive. In the real world that just doesn`t happen.

And when we lose all faith in government and society pulling together, then we shall indeed become an island and surely be washed away. Remember the old saying--"no man is an island, and the death of any man dimishes me"..

Apparently that is not the Liberatian Way--and I hope that my senses never become so compounded that it becomes my selfish way. Just too myoptic for my liking.

 

[mayhem]

So, any bets as to how long before we start seeing new and creative tax increases to cover the losses to state coffers from reduced usage of toll roads and bridges?

 

[begreen]

That's happening right now in VA isn't it BB?

 

[WoodMann]

So, any bets as to how long before we start seeing new and creative tax increases to cover the losses to state coffers from reduced usage of toll roads and bridges?

4 months....................