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

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

Katrina Brought Enduring Changes to New Orleans

The city’s recovery is the result of the people and culture the city is famous for, as well as newcomers and start-up industries More

China to Open Stock Markets to Pension Funds

In unprecedented move, government to soon allow local pension funds to invest up to $94 billion in domestic shares More

Magical Photo Slides Show Native Americans in Late 1800s

Walter McClintock spent 20 years photographing the Blackfoot Indians and their vanishing culture at the dawn of the modern age 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.
Colombians Flee Venezuela as Border Crisis Escalatesi
X
August 27, 2015 2:08 AM
Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Colombians Flee Venezuela as Border Crisis Escalates

Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Is China's Economic Data Accurate?

Some investors say China's wild stock market gyrations have been made worse by worries about the reliability of that nation's economic data. And some critics say the reports can mislead investors by painting an unrealistically-strong picture of the economy. A key China scholar says Beijing is not fudging ((manipulating)) the numbers, but that the economy is evolving quickly from smoke-stack industries to services, and the ways of tracking new economic activity are falling behind the change. V
Video

Video Next to Iran, Climate at Forefront of Obama Agenda

President Barack Obama this week announced new initiatives aimed at making it easier for Americans to access renewable energy sources such as solar and wind. Obama is not slowing down when it comes to pushing through climate change measures, an issue he says is the greatest threat to the country’s national security. VOA correspondent Aru Pande has more from the White House.
Video

Video Shipping Containers Provide Experimental Housing

Housing prices around the San Francisco Bay area are out of reach for many people, so some young entrepreneurs, artists and tech industry workers are creating their own houses using converted shipping containers. But as VOA's Mike O’Sullivan reports from Oakland, the effort requires ingenuity and dealing with restrictive local laws.
Video

Video Arctic Draws International Competition for Oil

A new geopolitical “Great Game” is underway in earth’s northernmost region, the Arctic, where Russia has claimed a large area for resource development and President Barack Obama recently approved Shell Oil Company’s test-drilling project in an area under U.S. control. Greg Flakus reports.
Video

Video Philippine Maritime Police: Chinese Fishermen a Threat to Country’s Security

China and the Philippines both claim maritime rights in the South China Sea.  That includes the right to fish in those waters. Jason Strother reports on how the Philippines is catching Chinese nationals it says are illegal poachers. He has the story from Palawan province.
Video

Video Technique May Eliminate Drill-and-Fill Dental Care

Many people dread visiting dentists because they're afraid of drills. Now, however, a technology developed by a British firm promises to eliminate the need for mechanical cleaning of dental cavities by speeding a natural process of tooth repair. VOA’s George Putic reports.
Video

Video China's Spratly Island Building Said to Light Up the Night 'Like A City'

Southeast Asian countries claim China has illegally seized territory in the Spratly islands. It is especially a concern for a Philippine mayor who says Beijing is occupying parts of his municipality. Jason Strother reports from the capital of Palawan province, Puerto Princesa.
Video

Video Ages-old Ice Reveals Secrets of Climate Change

Ice caps don't just exist at the world's poles. There are also tropical ice caps, and the largest sits atop the Peruvian Andes - but it is melting, quickly, and may be gone within the next 20 years. George Putic reports scientists are now rushing to take samples to get at the valuable information about climate change locked in the ice.
Video

Video French Experiment in Integrating Roma Under Threat

Plans to destroy France’s oldest slum have sparked an outcry on the part of its Roma residents. As Lisa Bryant reports from the Paris suburb of La Courneuve, rights groups argue the community is a fledgling experiment on integrating Roma who are often outcasts in many parts of Europe.
Video

Video Kenyans Turn to Agriculture for Business

Each year Kenyan universities continue to churn out graduates for the job market despite the already existing high rate of unemployment among youth in the country. Some of these young men and women have realized that agriculture can be as rewarding as any other business or job, and they are resorting to agribusiness in large numbers as a way of tackling unemployment. Rael Ombuor reports for VOA.
Video

Video First Women Graduate Elite Army Ranger School

Two women are making history for the U.S. Army by proving they are among the toughest of the tough. VOA's Carla Babb reports from Fort Benning, Georgia as 94 men and those two women rise as graduates of the difficult Ranger school.

VOA Blogs