Gas Prices

Essay by pookat36College, UndergraduateA, April 2007

download word file, 3 pages 2.0

Every motorist has been affected by the high cost and demand of gasoline purchases. On average, the U.S. pump price of gasoline has increased by more than 20 cents a gallon since the beginning of the year. As consumers across the country drive up to gasoline pumps to fill their tanks, they are all asking the same question -- why are prices rising so quickly to such high- levels? Consumers spend more on gasoline and have less money to spend on other purchases. According to (Klara, Robert, 11/2004), Americans drive more than 2.6 trillion miles a year, burning up 115 billion gallons of gas in the process. When prices go up, the expense of gas is felt acutely in the family purse-which in turn affects discretionary spending.

Prices at the pump jumped 350 a gallon between the beginning of the year and the summer vacation season. The NRA's latest research indicates that seven out of 10 operators say higher gas prices have had a negative impact on their businesses.

Higher fuel prices have driven up distribution costs as well-costs that are being passed directly on to the operator. According to Hudson Riehle, the National Restaurant Association's Sr. VP of Research and Information Services, anything that impacts cash-on hand, especially for lower-income households, has some effect on restaurant spending.

A survey that evaluates the rise in energy prices has an impact on public views of the tradeoff between boosting the energy supply and protecting the environment is called the Economic Pessimism Grows. The public blames energy producers for rising gas prices, but many also fault the president. More than a third (36%) blames major oil companies, while 27% point to President Bush and his administration. About one-in-five (18%) blame OPEC, Middle Eastern countries, and other foreign oil producers. Just 36%...