Adjusted For Inflation, Gasoline Prices Are Low
May 30, 2000
Experts report that gasoline prices are at near historic lows -- when inflation is taken into account. New technologies have made it easier to find and process fossil fuels -- and that has driven the price down to historic lows, inflation adjusted.
Following are some comparisons developed by Cambridge Energy Research Associates.
- The super-low prices of 1998 and 1999 were an aberration, analysts say -- because the Asian economic crisis sharply reduced gasoline demand in 1998.
- Although gasoline was 30 cents a gallon in the 1950s, that equates to about $1.75, based on the value of today's dollar.
- Americans were frantic when gasoline hit $1.25 a gallon in 1980 -- because that was the equivalent of $2.50 a gallon today.
- In 1980, the average cost to fuel a car was 17 cents per mile, but that dropped to 6 cents a mile last year -- thanks to lower inflation-adjusted oil prices and greater fuel efficiency.
Americans can, perhaps, take comfort from the fact that Britain's citizens pay much higher gasoline prices -- about $4.55 a gallon as of February. But a great proportion of that is due to taxes.
Source: Glenn Kessler, "Despite the Price, Gasoline Is Still a Bargain," Washington Post, May 27, 2000.
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