News / USA

Americans Take Oil Price Rise in Stride, Brace for Higher Prices

Gasoline prices are displayed on a pump at a filling station on the Palisades Interstate Parkway in Orangeburg, New York, March 7, 2011
Gasoline prices are displayed on a pump at a filling station on the Palisades Interstate Parkway in Orangeburg, New York, March 7, 2011

Multimedia

TEXT SIZE - +
Greg Flakus

Turmoil in the Middle East and North Africa in the past few months has driven the price of oil on the world market to more than $100 a barrel, causing a spike in fuel prices in the United States that is putting a crimp in transportation budgets for families and businesses alike. For the moment anyway, people are taking it in stride.

Filling up at the gasoline pump has become much more expensive in recent weeks as the sharp rise in crude oil prices comes down to the ordinary consumer.

Most people, including this woman, are not happy about it. “I am a college student and I have to drive 45 minutes to college, so it [is terrible].”

Many people are making adjustments, driving less or using cars with better fuel economy if they have that option. Richard, who owns a gas-guzzling truck, said he may start leaving it at home more often.

“I do work a ways from where I live, so I will have to drive the other car. We have a smaller car, a Ford Fusion, and that gets good gas mileage.”

Most U.S. drivers are reacting calmly to the rise in fuel prices, partly because prices have not yet gone as high as they were in 2008, when oil went to more than $147 a barrel.

Even a larger spike in prices would probably not have much impact on U.S. fuel consumption, according to Mahmoud El-Gamal, chairman of the Economics Department at Rice University. “It would take a long time of very high prices for people to change their lifestyles and for cities to be structured around those new lifestyles.”

The problem is that most U.S. cities, like Houston, are spread out over a large area and people commute to work or school from distant suburbs. El-Gamal said changing the infrastructure and the attitudes of people who choose to live far from their place of work is difficult and costly.

“We are seeing some urbanization trends, where the sub-urbanization that we observed over the last few decades is being reversed, but it is being reversed very, very slowly.”

The most immediate cause of the rise in oil prices is unrest in Libya and other Middle East oil-producing nations.

El-Gamal said any disruption, anywhere, affects the price of oil worldwide. “The United States does not actually import much oil from the Middle East; most of our oil would be from Canada, but still, because it is a global market, total supply and total demand will determine prices.”

What worries El-Gamal is not so much the unrest in Libya, but the strife in Bahrain, which sits near the major shipping routes out of the oil-rich Persian Gulf. “Disruption of oil flow out of the Persian Gulf could be catastrophic, then you would be talking $300 a barrel, not 120.”

Although states like Texas still produce oil, domestic production is far short of demand and the United States imports two thirds of the petroleum it uses.

That means prices at the pump here reflect such things as weakness in the dollar, which is used in international oil pricing, and growing demand for oil in China and India. Turmoil in the Middle East has the most dramatic impact, though, so that even the slightest hint of a supply disruption from the world's richest oil region can cause prices at U.S. gasoline pumps to rise quickly.

You May Like

Russia-Ukraine Crisis Could Trigger Cyber War

As tensions between Kyiv and Moscow escalate, so too has frequency of online attacks targeting government, news and financial sites More

Egyptian Court Jails 23 Pro-Morsi Supporters

Meanwhile, Egyptian officials say gunmen have killed two members of the country's security forces More

Pakistani Journalists Protest Shooting of Colleague

Hamid Mir, a host for private television channel Geo, was wounded after being shot three times Saturday, but is expected to survive More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Ukraine, Russia, United in Faith, Divided in Politicsi
X
Michael Eckels
April 19, 2014
There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Ukraine, Russia, United in Faith, Divided in Politics

There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Face of American Farmer is Changing

The average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population. It’s a troubling trend signaling big changes ahead for American agriculture as aging farmers retire. Reporter Mike Osborne says a new report from the U.S. Census Bureau is suggesting what some of those changes might look like... and why they might not be so troubling.
Video

Video Donetsk Governor: Ukraine Military Assault 'Delicate But Necessary'

Around a dozen state buildings in eastern Ukraine remain in the hands of pro-Russian protesters who are demanding a referendum on self-rule. The governor of the whole Donetsk region is among those forced out by the protesters. He spoke to VOA's Henry Ridgwell from his temporary new office in Donetsk city.
Video

Video Drones May Soon Send Data From High Seas

Drones are usually associated with unmanned flying vehicles, but autonomous watercraft are also becoming useful tools for jobs ranging from scientific exploration to law enforcement to searching for a missing airliner in the Indian Ocean. VOA’s George Putic reports on sea-faring drones.
Video

Video New Earth-Size Planet Found

Not too big, not too small. Not too hot, not too cold. A newly discovered planet looks just right for life as we know it, according to an international group of astronomers. VOA’s Steve Baragona has more.
Video

Video Copts in Diaspora Worry About Future in Egypt

Around 10 percent of Egypt’s population belong to the Coptic faith, making them the largest Christian minority in the Middle East. But they have become targets of violence since the revolution three years ago. With elections scheduled for May and the struggle between the Egyptian military and Islamists continuing, many Copts abroad are deeply worried about the future of their ancient church. VOA religion correspondent Jerome Socolovsky visited a Coptic church outside Washington DC.
Video

Video Critics Say Venezuelan Protests Test Limits of Military's Support

During the two months of deadly anti-government protests that have rocked the oil-rich nation of Venezuela, President Nicolas Maduro has accused the opposition of trying to initiate a coup. Though a small number of military officers have been arrested for allegedly plotting against the government, VOA’s Brian Padden reports the leadership of the armed forces continues to support the president, at least for now.
Video

Video More Millenials Unplug to Embrace Board Games

A big new trend in the U.S. toy industry has more consumers switching off their high-tech gadgets to play with classic toys, like board games. This is especially true among the so-called millenial generation - those born in the 1980's and 90's. Elizabeth Lee has more from an unusual café in Los Angeles, where the new trend is popular and business is booming.
Video

Video Google Buys Drone Company

In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
AppleAndroid