# Why is Gasoline so damn expensive right now ($3.00 US, approx) **URL:** \ **Category:** Great Debates\ **Created:** [December 12, 2010, 5:22pm UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899 "2010-12-12T17:22:30Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [December 12, 2010, 9:18pm UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/21 "2010-12-12T21:18:25Z")
Gas is a traded commodity that suffers from gambling and speculation like any other commodity. The old saw of demand and supply does not fit here. It is all about gambling. ---
**Author:** ![samclem](https://avatars.discourse-cdn.com/v4/letter/s/a9a28c/32.png) [@samclem](https://boards.straightdope.com/u/samclem)\ **Post date:** [December 12, 2010, 9:28pm UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/22 "2010-12-12T21:28:26Z")
> [@gonzomax](#): > > Gas is a traded commodity that suffers from gambling and speculation like any other commodity. The old saw of demand and supply does not fit here. It is all about gambling. Perhaps fairer to say _perceived_ supply and demand. Of course there is some percent of gambling/speculation mixed in. Just what percent of the current price would you estimate is due to gambling/speculation? 10%? 20%? ---
**Author:** ![RadicalPi](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/radicalpi/32/9806_2.png) [@RadicalPi](https://boards.straightdope.com/u/RadicalPi)\ **Post date:** [December 12, 2010, 11:12pm UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/23 "2010-12-12T23:12:44Z")
Here are some data that might help. Adjusted for inflation, since 1990, gas prices have gone down a bit and then gone up. As we see, the price in 1999 was roughly half of what it is now adjusted for inflation. The reason that the $3.00 a gallon is surprising is, in my opinion, because the actual price was steady for so long, many people’s idea of what gas should cost is the $1-$2 range just due to habit. If the price had stayed in line with inflation during the 90s, we would have seen prices in the $2.00 range for a lot longer than they did, and gas now at $3 wouldn’t be all that surprising, really. I think it’s mostly a question of what you’re used to. ```auto Year gas CPI gas w/CPI ($) (1990=1) ($) 1990 1.299 1.00 1.299 1991 1.098 1.04 1.054 1992 1.087 1.07 1.012 1993 1.067 1.11 0.965 1994 1.072 1.13 0.945 1995 1.103 1.17 0.946 1996 1.192 1.20 0.993 1997 1.189 1.23 0.968 1998 1.017 1.25 0.815 1999 1.116 1.27 0.876 2000 1.462 1.32 1.110 2001 1.384 1.36 1.021 2002 1.313 1.38 0.954 2003 1.516 1.41 1.077 2004 1.812 1.45 1.253 2005 2.240 1.49 1.499 2006 2.533 1.54 1.642 2007 2.767 1.59 1.744 2008 3.213 1.65 1.950 2009 2.315 1.64 1.410 2010 2.729 1.67 1.637 ``` Sources: ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt [http://www.eia.doe.gov/petroleum/data\_publications/wrgp/mogas\_history.html](http://www.eia.doe.gov/petroleum/data_publications/wrgp/mogas_history.html) ---
**Author:** ![Susanann](https://avatars.discourse-cdn.com/v4/letter/s/7ab992/32.png) [@Susanann](https://boards.straightdope.com/u/Susanann)\ **Post date:** [December 12, 2010, 11:44pm UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/24 "2010-12-12T23:44:45Z")
> [@samclem](#): > > It’s a combination of _all_ commodity prices going up since those idyllic times of yesteryear and the falling of the value of the US dollar against other currencies. > It has virtually _nothing_ to do with the oil producers raising prices beyond normal. Yep! Gasoline prices have not changed very much. It is the falling dollar. Gasoline only “appears” to be higher, because the value of the dollar has declined so much for the last decade or so with trillion dollar deficits. IF you want lower gasoline prices then stop deficit spending, stop borrowing, get rid of the balance of trade deficits, and start paying off the federal debt. ---
**Author:** ![Susanann](https://avatars.discourse-cdn.com/v4/letter/s/7ab992/32.png) [@Susanann](https://boards.straightdope.com/u/Susanann)\ **Post date:** [December 12, 2010, 11:51pm UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/25 "2010-12-12T23:51:59Z")
> [@Stink Fish Pot](#): > > Before the second invasion of Iraq, gasoline in the US hovered around $1 and $1.25, IIRC. > Gas prices then began to come back to earth a bit. Never to hit the pre-war pricing, but I remember it slipping below $2 a gallon, and things seemed to get better at the pump. > > In any event, I would think that for what we did for Kuwait in the early 90’s, they would fill up every oil tanker we could get there at a reasonable price. I think the US could also take as much oil as they wanted to from Iraq. Assuming this war is really for the people of Iraq, I The war in Iraq is causing the price of gasoline to increase, because of the huge cost of the war($ TRILLIONS OF DOLLARS) and the huge increase in federal debt incurred to finance the wars. Huge federal debt means a lower dollar, which means higher price of gasoline. If you want cheaper gasoline, then stop spending so much!!! \*According to a Congressional Budget Office (CBO) report published in October 2007, the U.S. wars in Iraq and Afghanistan could cost taxpayers a total of $2.4 trillion dollars by 2017 when counting the huge interest costs because combat is being financed with borrowed money. The CBO estimated that of the $2.4 trillion long-term price tag for the war, about $1.9 trillion of that would be spent on Iraq, or $6,300 per U.S. citizen. \* > **[Financial cost of the Iraq War](https://en.wikipedia.org/wiki/Financial_cost_of_the_Iraq_War)** > > The cost of the Iraq War following the 2003 invasion of Iraq is often contested, as academics and critics have noted many expenditures not represented in official estimates. There were also some recissions of funds in the 2010s. > The following is a partial accounting of financial costs of the Iraq War by the United States and the United Kingdom, the two largest non-Iraqi participants of the multinational force in Iraq. > A major report of direct costs was prepared by the Watson Center at Brown ... ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [December 12, 2010, 11:58pm UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/26 "2010-12-12T23:58:45Z")
> [@samclem](#): > > Perhaps fairer to say _perceived_ supply and demand. Of course there is some percent of gambling/speculation mixed in. > > Just what percent of the current price would you estimate is due to gambling/speculation? 10%? 20%? An Arab miinister from Saudi Arabia put it at 40 percent. That was last year. ---
**Author:** ![GreasyJack](https://avatars.discourse-cdn.com/v4/letter/g/df705f/32.png) [@GreasyJack](https://boards.straightdope.com/u/GreasyJack)\ **Post date:** [December 13, 2010, 12:09am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/27 "2010-12-13T00:09:38Z")
> [@Susanann](#): > > The war in Iraq is causing the price of gasoline to increase, because of the huge cost of the war($ TRILLIONS OF DOLLARS) and the huge increase in federal debt incurred to finance the wars. Huge federal debt means a lower dollar, which means higher price of gasoline. Except that the inflation-adjusted cost of gasoline is going up as well. Here’s some of the same data **RadicalPi** posted, but in nifty interactive chart form: [http://www.eia.doe.gov/emeu/steo/realprices/index.cfm](http://www.eia.doe.gov/emeu/steo/realprices/index.cfm) (set it to “retail gasoline prices” and slide the date bars as desired) If your theory that higher gas prices was entirely due to inflation was right, the “real” price line would be flat. And we’d be in real trouble if inflation alone sent the price of gas up almost 25% in a year! I would suggest that if we are talking about “real” prices, the opposite of what you suggest is true-- the price of oil still tends to fluctuate over the short-term based on the condition (or percieved condition) of the US Economy, so the economic doom and gloom you mention would be more likely to send “real” gas prices down. The current upswing in prices has to do with the economy coming out the recession more than anything else, or you can view it as coming up out of the price trough caused by the recession. ---
**Author:** ![Candyman74](https://avatars.discourse-cdn.com/v4/letter/c/ad7895/32.png) [@Candyman74](https://boards.straightdope.com/u/Candyman74)\ **Post date:** [December 13, 2010, 12:24am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/28 "2010-12-13T00:24:28Z")
> [@Stink Fish Pot](#): > > So, my question is… why has gas risen to over $3 a gallon, Bwah hah hah! It would be terrible to have such a problem! Speaking from somewhere with petrol at about $8 per gallon. ---
**Author:** ![Wendell\_Wagner](https://avatars.discourse-cdn.com/v4/letter/w/8491ac/32.png) [@Wendell\_Wagner](https://boards.straightdope.com/u/Wendell_Wagner)\ **Post date:** [December 13, 2010, 12:25am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/29 "2010-12-13T00:25:07Z")
Here are the inflation-adjusted gas prices in the U.S. over the past (almost) one hundred years: [http://www.inflationdata.com/inflation/images/charts/Oil/Gasoline\_inflation\_chart.htm](http://www.inflationdata.com/inflation/images/charts/Oil/Gasoline_inflation_chart.htm) As you can see, over that time it has bounced up and down between about $1.50 and about $3.50 in inflation-adjusted terms. ---
**Author:** ![samclem](https://avatars.discourse-cdn.com/v4/letter/s/a9a28c/32.png) [@samclem](https://boards.straightdope.com/u/samclem)\ **Post date:** [December 13, 2010, 1:12am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/30 "2010-12-13T01:12:13Z")
> [@gonzomax](#): > > An Arab miinister from Saudi Arabia put it at 40 percent. That was last year. Can you give me a link? Hard to believe. ---
**Author:** ![elucidator](https://avatars.discourse-cdn.com/v4/letter/e/8edcca/32.png) [@elucidator](https://boards.straightdope.com/u/elucidator)\ **Post date:** [December 13, 2010, 1:18am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/31 "2010-12-13T01:18:43Z")
I thank you for this invitation to speak on behalf of The Gas Is Too Damn High! Party. And, in conclusion, the gas is too damn high. Thank you, and good night. ---
**Author:** ![joebuck20](https://avatars.discourse-cdn.com/v4/letter/j/74df32/32.png) [@joebuck20](https://boards.straightdope.com/u/joebuck20)\ **Post date:** [December 13, 2010, 1:57am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/32 "2010-12-13T01:57:22Z")
I also wonder if it has anything to do with us being in the middle of the holiday season and the spike in travel that brings. ---
**Author:** ![elfkin477](https://avatars.discourse-cdn.com/v4/letter/e/a9a28c/32.png) [@elfkin477](https://boards.straightdope.com/u/elfkin477)\ **Post date:** [December 13, 2010, 2:09am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/33 "2010-12-13T02:09:32Z")
> [@Gymnopithys](#): > > Damn expensive ? It’s less than half we pay for in Europe. ($1.80 a liter = $7.20 a gallon) I believe public transportation is a lot more available in Europe, though. Isn’t a lot of the cost of gas in Europe tax to support public transportation? There are a lot of places in the US (here, for example) where there are no buses/trains/subways/taxis available in “bedroom communities” where people live but do not work, which pretty much forces people to drive because walking or biking more than 25 miles a day is unrealistic - even if a person was in good enough shape to do so, the roads aren’t pedestrian friendly even in the nicest of weather. ---
**Author:** ![samclem](https://avatars.discourse-cdn.com/v4/letter/s/a9a28c/32.png) [@samclem](https://boards.straightdope.com/u/samclem)\ **Post date:** [December 13, 2010, 2:10am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/34 "2010-12-13T02:10:06Z")
> [@joebuck20](#): > > I also wonder if it has anything to do with us being in the middle of the holiday season and the spike in travel that brings. No, it has nothing to do with that. ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [December 13, 2010, 2:30am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/35 "2010-12-13T02:30:43Z")
> [@samclem](#): > > Can you give me a link? Hard to believe. I used the link in several post in the past, but my computer blew up and I am using a brand spanking new one with no saved links. I will look for it again. ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [December 13, 2010, 2:37am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/36 "2010-12-13T02:37:06Z")
[Gas could fall to $2 if Congress acts, analysts say - MarketWatch](http://www.marketwatch.com/story/gas-could-fall-to-2-if-congress-acts-analysts-say) Here is a similar article. ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [December 13, 2010, 2:45am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/37 "2010-12-13T02:45:55Z")
Why’s it a bad thing for gasoline to be expensive? My understanding was that we were runnig out of oil. Doesn’t it make sense, then, for its price to increase? Aren’t we worried about how it pollutes? ---
**Author:** ![joebuck20](https://avatars.discourse-cdn.com/v4/letter/j/74df32/32.png) [@joebuck20](https://boards.straightdope.com/u/joebuck20)\ **Post date:** [December 13, 2010, 3:23am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/38 "2010-12-13T03:23:55Z")
> [@RickJay](#): > > Why’s it a bad thing for gasoline to be expensive? > > My understanding was that we were runnig out of oil. Doesn’t it make sense, then, for its price to increase? Aren’t we worried about how it pollutes? Because us folks who live in a part of the country where public transportation sucks and is basically non-existent in a lot areas have to drive to work. ---
**Author:** ![samclem](https://avatars.discourse-cdn.com/v4/letter/s/a9a28c/32.png) [@samclem](https://boards.straightdope.com/u/samclem)\ **Post date:** [December 13, 2010, 4:16am UTC](https://boards.straightdope.com/t/why-is-gasoline-so-damn-expensive-right-now-3-00-us-approx/563899/39 "2010-12-13T04:16:36Z")
> [@gonzomax](#): > > An Arab miinister from Saudi Arabia put it at 40 percent. That was last year. > [@samclem](#): > > Can you give me a link? Hard to believe. > [@gonzomax](#): > > I used the link in several post in the past, but my computer blew up and I am using a brand spanking new one with no saved links. I will look for it again. > [@gonzomax](#): > > [Gas could fall to $2 if Congress acts, analysts say\