2008 Woodie Awards
Gas Prices guzzle student budgets
G. Keith Evans
Issue date: 3/21/08 Section: News
The price of gasoline, as you may have noticed, has gone up. Maybe "gone up" is an understatement; more appropriately, the price of gas has skyrocketed to levels previously deemed obscene. Currently, the average national price for a gallon of gas is $3.28 per gallon, up nearly 75 cents per gallon from this time last year and up a whopping 117% from just five years ago.
Although this price is still slightly lower than the infl ation-adjusted record high of $3.40 per gallon in 1981, the record high prices of crude oil - which recently exceeded $111 per barrel - have moved some analysts to predict that unprecedented gas prices are soon to come.
Some people blame the president; others blame environmental controls placed on refineries. Analysts and professionals impugn the booming economy in China and India, while some argue that it is the result of traditionalAmerican greed.
Regardless of cause, one thing is clear: the effect is profound. Virtually every facet of the American economy is touched by the price of fuel. Products are assembled in factories that consume enormous amounts of energy to power their facilities. After leaving the factory, products are shipped to a distribution center by trucks and barges that burn even more fuel. The distribution center uses energy to power its buildings, and the shipment from the center to the store drinks even more gas. By the time an item reaches a store shelf, as much as 10% of its price is due to transportation costs.
Rising costs in each of these transactions are why prices, on average, are about 20.3% higher now than they were just eight years ago (based on data from the federal Bureau of Labor Statistics Consumer Price Index). In contrast, the average salary increase during the same period has adjusted only about 10%, meaning consumers have less buying power now than just a few years ago.
All of this information means that Rollins students are paying more and essentially getting less for their dollar. The biggest and most obvious impact, of course, is at the gas pump. The average car has a fuel capacity of 16 gallons. In 2003, a car's tank could have been filled for $24.16. At current prices, topping a tank costs $52.48, an increase of $28.32.
Although this price is still slightly lower than the infl ation-adjusted record high of $3.40 per gallon in 1981, the record high prices of crude oil - which recently exceeded $111 per barrel - have moved some analysts to predict that unprecedented gas prices are soon to come.
Some people blame the president; others blame environmental controls placed on refineries. Analysts and professionals impugn the booming economy in China and India, while some argue that it is the result of traditionalAmerican greed.
Regardless of cause, one thing is clear: the effect is profound. Virtually every facet of the American economy is touched by the price of fuel. Products are assembled in factories that consume enormous amounts of energy to power their facilities. After leaving the factory, products are shipped to a distribution center by trucks and barges that burn even more fuel. The distribution center uses energy to power its buildings, and the shipment from the center to the store drinks even more gas. By the time an item reaches a store shelf, as much as 10% of its price is due to transportation costs.
Rising costs in each of these transactions are why prices, on average, are about 20.3% higher now than they were just eight years ago (based on data from the federal Bureau of Labor Statistics Consumer Price Index). In contrast, the average salary increase during the same period has adjusted only about 10%, meaning consumers have less buying power now than just a few years ago.
All of this information means that Rollins students are paying more and essentially getting less for their dollar. The biggest and most obvious impact, of course, is at the gas pump. The average car has a fuel capacity of 16 gallons. In 2003, a car's tank could have been filled for $24.16. At current prices, topping a tank costs $52.48, an increase of $28.32.
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