The Big Picture on Gasoline Prices

What is the big picture on gas prices? They say a picture is worth a thousand words. Below is the big pciture, but remember, there are plenty of details and circumstances that ultimately affect the meaning of the picture.

The first column shows the actual national average price per gallon for that year. The most important factor you have to take into account is the cost of living or the status of the economy in any particular year. The column on the right shows the price you would pay for that gallon of gas today, with todays dollar.

Also keep in mind when looking at the fluctuation between a span of years or in any given year, the events of that day such as the great oil crisis, or the Korean War, or natural disasters, etc.

One of the first things that caught my eye was that, in 1998 gas was $1.06 per gallon and if gasoline was priced today with 1998 oil prices, we would be paying $1.27 today for a gallon of gas. The second thing that caught my eye was that between 1920 and 1973 (53 years) the price of gas only increased 9 cents a gallon making a 23.1% increase (overall, taking into consideration it had both ups and downs), and in the next 25 years (1973 to 1998) it rose $0.67 per gallon making a 63.25% increase (again, overall).

Hang on to your knickers, because here is where my stomach starts to churn for a decent hurl. In the last 9 years (1998 to 2007) gas has gone from $1.06 a gallon to a national average of $2.97 a gallon (April 24th, 2007 national average) which is an increase of $1.91 a gallon or a 64.3% increase. IN 9 YEARS! not 25 years, and not 53 years. Does anyone see the danger of this kind of trend? If I just roughly estimate another 64% increase, it would happen in another 3 to 4 years (53 years in half to 25 years, 25 years roughly in half to 9 years (actual 12.5) and 9 years (roughly in half) to 3-4 years) making gas costing us $4.65 a gallon in 2010-2011.

One thing that will give the Oil Companies the perfect excuse to justify raising the oil prices equal to $4.65 a gallon for gasoline? The Democrats having their way and increasing minimum wages so the oil companies can say “the American household budget can easily “handle” it. Aside from that, when does the trend stop or change? With Mrs Slick Willy as president? LOL
FreedomCAR and Vehicle Technologies Program: Fact #426: May 29, 2006

The Year Retail Gasoline Price
(current dollars/gallon)
Retail Gasoline Price
(constant 2005 dollars/gallon)
1920 0.30 2.91
1921 0.26 2.87
1922 0.25 2.93
1923 0.22 2.51
1924 0.21 2.39
1925 0.22 2.48
1926 0.23 2.58
1927 0.21 2.37
1928 0.21 2.39
1929 0.21 2.45
1930 0.20 2.33
1931 0.17 2.18
1932 0.18 2.56
1933 0.18 2.68
1934 0.19 2.75
1935 0.19 2.69
1936 0.19 2.73
1937 0.20 2.71
1938 0.20 2.70
1939 0.19 2.63
1940 0.18 2.57
1941 0.19 2.55
1942 0.20 2.45
1943 0.21 2.32
1944 0.21 2.28
1945 0.21 2.22
1946 0.21 2.08
1947 0.23 2.02
1948 0.26 2.10
1949 0.27 2.20
1950 0.27 2.17
1951 0.27 2.04
1952 0.28 2.03
1953 0.29 2.10
1954 0.29 2.11
1955 0.29 2.12
1956 0.30 2.15
1957 0.31 2.15
1958 0.30 2.05
1959 0.31 2.05
1960 0.31 2.05
1961 0.31 2.01
1962 0.31 1.98
1963 0.30 1.94
1964 0.30 1.91
1965 0.31 1.93
1966 0.32 1.93
1967 0.33 1.94
1968 0.34 1.89
1969 0.35 1.85
1970 0.36 1.80
1971 0.36 1.76
1972 0.36 1.69
1973 0.39 1.70
1974 0.52 2.08
1975 0.57 2.06
1976 0.61 2.11
1977 0.66 2.11
1978 0.67 2.01
1979 0.90 2.43
1980 1.25 2.95
1981 1.38 2.96
1982 1.30 2.62
1983 1.24 2.43
1984 1.21 2.28
1985 1.20 2.18
1986 0.93 1.65
1987 0.95 1.63
1988 0.95 1.56
1989 1.02 1.61
1990 1.16 1.74
1991 1.14 1.63
1992 1.13 1.57
1993 1.11 1.50
1994 1.11 1.47
1995 1.15 1.47
1996 1.23 1.53
1997 1.23 1.50
1998 1.06 1.27
1999 1.17 1.37
2000 1.51 1.71
2001 1.46 1.61
2002 1.36 1.47
2003 1.59 1.69
2004 1.88 1.94
2005 2.30 2.30
2006* 2.40 2.35
* March 2006 only.
Source: Energy Information Administration, Monthly Energy Review, April 2006, Table 9.4. Historical data from 1920-1975 are from other EIA sources.
Consumer Price Index from the Bureau of Labor Statistics was used to calculate constant dollars.

Rocket

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7 responses to “The Big Picture on Gasoline Prices

  1. Thanks for this excellent reality check.

  2. Thank you for the comment Lolarusa. I’m glad you enjoyed the information. If you would like information on anything specifically, just let me know.

  3. I wish more web sites had raw usable data like this one does not only was it exactly what I was looking for it was more due to the inflation corection

  4. Thank you for your comment Aaron. I’m glad you found what you were looking for here. Reader feedback is very helpful to me and the fact you were looking specifically for the inflation correction helps me bring you better information.
    Thanks again for your readership and kind words.
    Rocket

  5. Ok what I don’t understand is how the oil companies can claim on their taxes and to the world that they make BILLIONS thats with a B by the way and then turn around and tell congress and the senate committee that they can’t afford to cut the cost of gas due to the fact that the cost to import it is so high. It’s seems to me if they are posting proffits in the Billions for the first 3 months of the year then they can afford to lower the price of gas and have the other area’s of their multi-billion dollar company offset the cost of their oil refinement .

  6. Have you ever thought about including a little bit more than just your articles?
    I mean, what you say is important and all. However think of if you
    added some great graphics or videos to give your posts more, “pop”!
    Your content is excellent but with images and videos, this website could certainly be one of the most beneficial in its niche.
    Wonderful blog!

  7. Did you need to take into account the rising federal and state taxes on gas at the pump?

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