realize that most things are cheaper today when factoring in inflation, right?
Yeah, but it drives me crazy when people point to 25 cent a gallon gas in the 60's saying it was so much cheaper then. Right. You were also making $100 bucks a week then too.
fuel efficiency is missing in equation
it really should be cost per mile ..
in 1973 gas was 35 cent a gallon but cars averaged 13 miles a gallon so when it went up to 55 cent is was a terrible shock to economy (also you could not even get gas because of shortages)
gas actually spiked more in 2013 than 1973 but because fuel efficiency had doubled so the shock to economy was minor ..
thank god oil is going into death spiral soon because EV will take over in the next 10 years
That graph is interesting but I agree there are problems with it.
First, it starts during World War I, which would have stretched oil supplies, so that probably represents a peak. Economic activity was depressed at the end of 1918 and beginning of 1919 because of the Pandemic, so that, combined with the end of the war, probably led to a swift fall in prices. I'm not an expert on this sector, anybody know if that's right?
Second, during the Great Depression, there was deflation, so that depresses the price line without recognizing that gas was getting more "expensive" because dollars were actually worth more. (People look at old menus and ads and marvel about how cheap things were. What they don't figure in is, there used to be periods of deflation now and then, and they drive prices down. I would think we're in danger of a period of deflation soon unless the economy restarts strong. That would be bad.)
Also agree about cost per mile being more relevant than cost per gallon, but that's not how gas is sold. You don't put 500 miles in your tank, you fill up with 15 gallons of regular, or whatever.
gas is far more highly refined than 30 years ago. They used to use Tetra-Ethyl-Lead(TEL) to bump the octane ratings for gas. But once lead was banned, oil companies had to refine the hell out of oil to get the necessary octane to prevent engine knock, or predetonation. Us older farts remember those late 70s and 80s cars pinging and popping under load...
Yeah, but it drives me crazy when people point to 25 cent a gallon gas in the 60's saying it was so much cheaper then. Right. You were also making $100 bucks a week then too.
it really should be cost per mile ..
in 1973 gas was 35 cent a gallon but cars averaged 13 miles a gallon so when it went up to 55 cent is was a terrible shock to economy (also you could not even get gas because of shortages)
gas actually spiked more in 2013 than 1973 but because fuel efficiency had doubled so the shock to economy was minor ..
thank god oil is going into death spiral soon because EV will take over in the next 10 years
Second, during the Great Depression, there was deflation, so that depresses the price line without recognizing that gas was getting more "expensive" because dollars were actually worth more. (People look at old menus and ads and marvel about how cheap things were. What they don't figure in is, there used to be periods of deflation now and then, and they drive prices down. I would think we're in danger of a period of deflation soon unless the economy restarts strong. That would be bad.)
Also agree about cost per mile being more relevant than cost per gallon, but that's not how gas is sold. You don't put 500 miles in your tank, you fill up with 15 gallons of regular, or whatever.
Still interesting regardless. Thanks for posting.
Keep at it Russia and Saudiville....
Keep at it Russia and Saudiville....
Except the low price is crushing the US producers. When the economy recovers and demand goes back up, we’ll be importing more at much higher prices.