Rising Gas Prices in the United States

1024 Words3 Pages
bulb-icon

Recommended: Effects of rising gas prices

Once upon a time Americans hopped into their cars on warm spring days and took long drives to admire the beauty of nature. Teenagers took joy rides around town to meet friends and rode from one “hot spot” to another. Those were the days when gas prices were affordable to the average American. Over the past few years, gas prices in the United States have been on the rise. What is causing the increase in gas prices?

To understand the increase in gas prices, one must first identify the distribution of dollars paid per gallon at the pump. According to the U.S. Energy Information Administration (eia) in 2010, the annual average paid at the pump consisted of 68% crude oil, 7% refining, 10% distribution and marketing, and 15% taxes (see Fig.1). This shows an increase of crude oil over the 2000-2009 average of 51%. (e. I. Administration)

Currently, the most important factor in the rise of gas prices is the increasing cost of crude oil. Unfortunately, the United States has three percent of the world’s oil reserves. (Horsley) In 2009, the United States was third in crude oil production as well as the world’s largest petroleum consumer. (e. I. Administration) Such consumption required and still requires the United States to import petroleum/crude oil from other countries.

Mainly, the United States imports petroleum products and crude oil from Canada 23.3%, Venezuela 10.7%, Saudi Arabia 10.4%, Mexico 9.2%, and Nigeria 8.3%. (e. I. Administration) In addition, approximately 77 other countries import to the United States. (e. I. Administration)

Worldwide, there are many factors contributing to the increase in cost per barrel. Most recently, Libyan rebels, inspired by the success of their Tunisian and Egyptian neighbors, are up...

... middle of paper ...

... Oil Production.” 10 March 2011. 19 March 2011 .

Press, Associated. “MSNBC Oil Prices Fall as Libya Promises Ceasefire.” 18 March 2011. 19 March 2011 .

Press, Associated. “Oil Hits Highest Levels Since Recession.” 25 March 2011. 25 March 2011 .

Press, The Associated. “IEA Says Libyan Oil Exports Halted.” 15 March 2011. 25 March 2011 .

Reuters. “Factbox: Libyan Oil Production, Exports, Customers.” 11 February 2011. 20 March 2011 .

Show More
Related

  • Three Mile Island Pros And Cons

    514 Words  | 2 Pages

    oil,coal, and natural gas, since we have uranium right here in the United States so no need to import

    Read More

  • Robert McNamara's Eleven Lessons in "The Fog of War" and the Ongoing Conflict in Libya

    1346 Words  | 3 Pages

    The 2011 Libyan Civil War started as peaceful protesting in front of the police headquarters over ruler Muammar Gaddafi’s corruption as their leader. This protest was met with brutal police violence. This sparked the Transitional National Council’s formation in an effort to change the government. The peaceful protest then made the leap to a rebel uprising that began to spread across the entire country. In order to contain this rebellion effort, Gaddafi stepped up his military control of the country and took back major cities. He also blocked off the public’s access to the media with censorsh...

    Read More

  • Gasoline Economics

    658 Words  | 2 Pages

    Gasoline is one of the many conversation starters anywhere you go. People have different opinions on why gasoline prices are fluctuating at such a rapid pace. Some Americans have chosen a way of thinking towards the prices. Whether it be making up rumors or just plainly trash talking towards our government. You make ask yourself the same questions many economist do, why has the price of oil been dropping so fast?

    Read More

  • US Needs to Have Energy Independence

    795 Words  | 2 Pages

    America is dependent on other nations for their ability to create energy. The United States is the world’s largest consumer of oil at 18.49 million barrels of oil per day. And it will continue to be that way for the foreseeable future considering the next largest customer of oil only consumes about 60% of what the U.S. does. This makes the U.S. vulnerable to any instability that may arise in the energy industry. In 2011, the world’s top three oil companies were Saudi Aramco (12%), National Iranian Oil Company (5%), and China National Petroleum Corp (4%). The risk associated with these countries being the top oil producers is twofold. One, they are located half way around the world making it an expensive to transport the product logistically to a desired destination. And two, the U.S. has weak, if not contentious,...

    Read More

  • Supply And Demand of Gasoline

    1019 Words  | 3 Pages

    I am a husband and a father of four lovely children. We need a large vehicle to haul all of us around town. And of course I would do anything to keep them safe and I always want to provide them with the best. Therefore, after the birth of our fourth child two and a half years ago, my wife and I decided to upgrade our Ford Explorer to a Ford Expedition. We got everything from the side-curtain airbags to the TV and DVD player. What we did not know was we also purchased a rather large unleaded gas bill. The first time we filled the tank it cost us roughly $35; today it costs us right around $75 to fill the tank. Obviously the price of gas has increased significantly in the last two years. The price increase is due to a fluctuation in the supply and demand of not only gasoline but also crude oil, which is needed to manufacture gasoline. In addition, several other factors are influencing a change in the price of gasoline.

    Read More

  • The Rise of the American Empire

    1633 Words  | 4 Pages

    Aside from causing a major shift in geopolitical power, WWII also solidified the integral role oil played politically in national security. However, following the war the United States was no longer the world’s largest oil producer and was unable to maintain self-sufficiency as it had in the past. As a national security imperative oil was more important at this point than ever before. America’s war machine needed to be well oiled in case the new Cold War suddenly turned hot.

    Read More

  • America’s Dependence on Foreign Oil

    1087 Words  | 3 Pages

    "United States Oil - Exports - Economy." Index Mundi - Country Facts. Web. 26 May 2011. .

    Read More

  • Why The United States should Intervene in the Syrian Civil War

    1481 Words  | 3 Pages

    SUMMARY: The Syrian Civil War between the Syrian government, and the insurgents, as well as the Free Syrian Army has been escalating since early 2011. The United States, and our allies have faced difficulty in sending aid to Syria, and continue to deal with obstacles in sending even basic medications to Syrian civilians. However, the United States and its allies have also contributed to the lack of organization and the disparity in Syria by sending aid and artillery to individuals based only on political connection, and ignoring organization, local alliances, and without a true understanding of the reality of the Syrian localities to best protect the Syrian protestors. The question addressed in this memo will be defining the viable options to be pursued in Syria, how to pursue them, and assessing the most beneficial path of least resistance when offering aid, funds, and artillery to specific groups in the country. The recommendation will be that although the best alternative action item would be to choose a Syrian group with the least oppositional values comparative to the United States to fund, supply with arms, and train; that the United States should do nothing for the time being. Given the physical and financial risk involved with the Syrian Civil War, it would be prudent for the United States to simply observe how the war progresses over the next several months, as well as complete some research to truly understand the state of affairs in local areas of Syria to determine the extent to which the United States could identify a group to provide aid to, as well as the extent to which the United States involvement would be within Syria.

    Read More

  • Price Elasticity Of Demand For Gasoline

    237 Words  | 1 Pages

    The article by Mike Moffatt shows the price elasticity of demand for gasoline. According to Molly Espey the average price elasticity of demand for gasoline in the short- run is-0.26 and -0.58 In the long-run, which is a 10% raise in the price of gasoline lowers quantity demanded by 2.6% in the short- run and 5.8% in the long- run.Also, there are a studies were conducted by Phil Goodwin, Joyce Dargay and Mark Hanly at review of income and price elastics in the demand for road traffic and each of them has different study. Furthermore, the realized elasticities depend on factors such as the timeframe and locations that the study covers. If the gas taxes will rise, will cause consumption to decrease.

    Read More

  • Todays Rising Gas Prices

    939 Words  | 2 Pages

    Today's Rising Gas Prices At some point in everyone’s lives, we are affected by the rising gas prices in today’s economy. Natural gas is not a renewable resource, since there is a fixed amount of it trapped in the Earth. However, many people carry the misconception that there is a very limited amount of natural gas, and that we may use all of it. This isn’t true, though. The gas shortages of the 1970s were prompted by the government’s lack of faith in the industry’s ability to discover and develop new reserves, not by a lack of gas supply.

    Read More

  • The Rise of Fuel in Australia

    1204 Words  | 3 Pages

    The Australian Broadcasting Corporation’s (ABC) news article titled, “Petrol price soars, more pain at the pump ahead,” discusses the rise in the price of fuel and its effect on Australian motorists. This article also discusses how this rise in the price of fuel occurred, mainly focusing on its effect on consumers (Janda 2014).

    Read More

  • Diesel Fuel Prices & Trucking Industry

    1760 Words  | 4 Pages

    What is the reason that gasoline and fuel prices are so high? Most people believe it is because of OPEC raising the price of oil. This answer is only partially true. In fact, there are several others factors that must also be taken into account when determining the cause of high fuel prices in the United States and in other parts of the world.

    Read More

  • Effects of Rising Gas Prices

    414 Words  | 1 Pages

    In conclusion, the effects of higher gas prices cutting back in vacation time, prices of everything is going up “inflation”, car companies making more efficient cars.

    Read More

  • Fuel Wars

    879 Words  | 2 Pages

    Over the past two years, it has been said that gas prices would begin to rise in 1999. Immediately, this news grasped the attention of the business sector and public. Both spent their time devising a plan, on how to keep the prices low, but the time has come for these plans to begin working. The fuel prices have increased dramatically and the economy is now starting to feel the effect.

    Read More

  • Project Management in the Automotive Industry: A Critical Review

    1824 Words  | 4 Pages

    ...n. "Twenty Years after the Embargo US Oil Import Dependence and How It Can Be Reduced." Energy Policy 22.6 (1994): 471-85. Print.

    Read More

More about Rising Gas Prices in the United States

Open Document