TerraPass blog

Gas purchases plummet

Adam Stein | June 2, 2008

Rising prices inspire Americans to conserve (finally!)

 

Gasoline consumption has long proved strangely impervious to shifts in the price of oil. No longer:

It remains to be seen how permanent these shifts in behavior are. Adjusted for inflation, gas prices really aren’t all that high. They’re high, to be sure, but not that high. Typically what happens when the price of oil jumps is that consumers whine a lot, then get used to the new price, and then revert to their old behavior. A lot hangs on whether the price increase is sustained.

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Comments


  • 1.

    I live in Philadelphia, and there was a big article about the calls to AAA for people that ran out of gas has doubled.


    Reply
  • 2.

    Clandestine gas siphoning is also on the rise, which has led to a surge in purchases of locking gas caps.

    I figured that drivers would respond eventually, but these things take time. First we have to realize that the problem won't go away on its own, then we have to weigh our options, then we have to convince ourselves and our families that this change is acceptable and beneficial, and finally we can take action.

    Why might this be different from, say, the late '70s? Probably because credit cards and monster mortgages weren't as widespread, so the average family had more of a safety net. If money got tight, they could cut back on some expenses, maybe put the wife n' kids to work to earn a little extra money. Today, both parents are already working, which is all fine and good except that both paychecks are consumed by loan payments. A layoff or a spike in commodity prices becomes more than they can bear, and soon you see workers raiding their retirement accounts to keep up with daily obligations.

    -- A.


    Reply
  • 3.

    Boston, a city with an already solid public commuter track record, is also showing evidence of commuter behavior shifts. The MBTA saw a 5.5% rise in ridership in April. This rise was on top of already significant gains earlier in the year.


    Reply
  • 4.

    This is very hard, but it's great news!

    Wish more cities had better public transportation...

    I'd have to walk about 2 miles to the nearest bus stop...


    Reply
  • 5.

    I think a lot of people forget that gas conservation isn't much of an option for people who don't live in a city.

    I drive a small car already and I still have to drive all the time to get to work.


    Reply
  • 6.

    Ben says
    "I think a lot of people forget that gas conservation isn’t much of an option for people who don’t live in a city.
    I drive a small car already and I still have to drive all the time to get to work."

    Car-pool!


    Reply
  • 7.

    "Car-Pool"? I would never randomly get into a vehicle with someone I don't know. Do you pick up hitch-hikers?

    There are always going to be people who need to drive. Road travel is important to our country's economy. The drops are good, but I'm ticked off that there aren't more PHEV (Plug-ins) being offered and that these car companies are going to make us wait two years before we see cars that finally get serious about TRYING to conserve. How hard would it be for Toyota to offer a plug-in option? We'd end up with 100+ MPG on those cars! Some people wouldn't even need to use a drop of gas in their daily commute with a plug-in.


    Reply
  • 8.

    Before you start jumping with glee over the plug-ins, please remember that they use energy too. Unless we turn all our electricity plants into renewable ones, the environment's still going to suffer. Plug-ins are definitely good things, but not quite the complete solution to our problems.

    And I LOVE the statistics in this article!! WOW!


    Reply
  • 9.

    Plug-ins are friendlier carbon-wise than most people realize. Most charging would likely occur at night during off-peak hours anyway. If battery technology hits the market that would allow a 300 mile range and sub-hour charging (it exists) and if the car makers ever built a plug-in hybrid capable of burning bio-diesel in a small constant-speed motor exclusively for charging the on-board batteries while traveling, that would be my dream vehicle. As long as its a 4-passenger hatchback.


    Reply
  • 10.

    Jen (#7) said:
    "Car-Pool?" I would never randomly get into a vehicle with someone I don?t know.

    It doesn't have to be a stranger. For a good part of this winter, I drove my mother to her job, then continued on to my place of business*. You may have a neighbor or a co-worker who's interested in carpooling, but who is similarly apprehensive about getting into a stranger's car.

    If you can't find anybody you trust enough to share a ride, oh well, that didn't work out, move on to the next idea. Some of us honestly have no viable alternatives to single-occupant commuting. Many of us do, though, and when we follow through on those alternatives, we can reduce the congestion, pollution, and (at least hypothetically) expense of everybody's commute.

    -- A.
    * In warmer months, we each have bicycles and company-sponsored bus passes.


    Reply
  • 11.

    I will believe that high gas prices are being felt by the American public when I drive on I-25 and cease to see 10 percent of the motorists driving 75 to 85 miles per hour.
    Ed Mangold


    Reply
  • 12.

    Do you have a link for the moving average plot (the last item)?


    Reply
  • 13.
  • 14.

    What's interesting is beyond the couple months drop, is the year or so it's been approximately constant. I don't recall that we've been complaining about the price of gas for that long. Griping, yeah, but it didn't hurt enough to cut back until very recently.


    Reply
  • 15.

    I'm wondering if it hasn't been that a lot of people have been absorbing the higher cost by using credit cards and they're now at their limits.


    Reply
  • 16.

    mark (#15) said:
    I?m wondering if it hasn?t been that a lot of people have been absorbing the higher cost by using credit cards and they?re now at their limits.

    Quite possibly, mark. Consider this CNN/Money article from May 2007:
    Even though consumers are still tapping into their home equity to cover short-term hits to their wallets like the spikes in energy and gas costs, [Steve] Cochrane [Senior economist for Economy.com] said this will lessen as home price appreciation slows and lending guidelines tighten.

    And just last month, Bloomberg reports:
    U.S. consumer borrowing jumped more than double the amount economists forecast in March [2008], indicating a slowing economy is forcing Americans to accumulate credit-card and other forms of debt... Consumers are turning to credit cards after banks tightened standards for home-equity loans and other borrowing.

    The peoples' sudden discovery of public transportation is an interesting sign. Perhaps they're looking at the debt they've acquired by trying to wait it out, and making some sort of meaningful change while they still have a choice.

    -- A.


    Reply
  • 17.

    But there is so much more to life once your focus is no longer on the 'car society'. My values, buying patterns and my lifestyle have been changed profoundly since giving up my car. I now have more money left over at the end of the month, and can even bank some. The transition is upon us, America and it is a good and humane one!


    Reply
  • 18.

    Since my last post, the local news has reported since gas went over $4/gal, projected tax revenues have dropped due to a reduction in gasoline sales. We have apparently found that pricepoint. I know my driving is a lot less than it used to be, and I like going places. It's easier to merge into traffic and find a parking spot. I've gone back in time, it seems, except my vehicles are nicer and more economical than 10 years ago. If it gets any quieter on the street I may even feel safe when riding my bicycle again.


    Reply

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