Gas Prices Continue to Fall, At Lowest Level in Nearly Two Months

Thanks to decreased demand and falling oil prices, the national average price of gasoline has fallen each of the last 13 days, and is now at levels not seen since the end of May.

Since hitting its record high of $4.12 per gallon on July 15, the price of gasoline has fallen 19 cents – over 4% – and now stands at $3.93, a price not seen since May 29.

According to, Hawaii is reporting the highest state-wide average price at $4.55 per gallon, while Oklahoma is reporting the lowest state-wide average price at $3.62 per gallon. Eleven states and Washington, D.C. are reporting an average price above $4 per gallon.

Much of the decline in gasoline prices can be directly attributed to the fact that Americans have started adjusting their driving habits in order to compensate for having to pay more at the pump. For example, according to Federal Highway Administration, Americans drove 9.6 billion fewer miles in May 2008 than in May 2007.

According to an article written by Kenneth Musante and Aaron Smith published on (see the above link), Americans have traveled nearly 41 billion less miles in 2008 than at the same point in 2007.

Assuming the average vehicle gets about 20 miles per gallon, Americans have used over two billion less gallons of gasoline so far this year.

Additionally, the reduction in miles and corresponding decrease in gasoline consumption doesn’t take into account the fact that many Americans are still driving the same amount, but have traded in less fuel efficient vehiclese such as trucks and SUVs for cars with better fuel economy such as compact cars and hybrids.

Hopefully even if gas prices continue to fall, we’ll continue to be mindful of the amount of miles we drive and continue to move towards more fuel efficient vehicles.

Walking or Riding a Bike More? Thanks Gas Prices!

With gasoline prices being about 40% higher than what they were last year, it should come as no surprise that many of us have started to significantly reduce the amount we drive.

That being said, it’s not like we’re not still going to the store, or taking a short trip over to a friend’s house. We’re just taking alternate forms of transportation.

Based on a recent poll, it appears as if many of us have become reacquainted with two of the oldest forms of transportation: walking and riding a bicycle.

For the past two weeks, I’ve had a poll up on Daily Fuel Economy Tip which asked the following: “Are you walking and/or riding a bike more due to higher gas prices?” Here’s how the responses broke down:

  • 49% stated they are walking/riding more thanks to high gas prices
  • 48% stated they are not walking/riding more
  • 3% stated they were unsure

Even over the last couple of weeks, it seems to me that my morning commute is far less crowded and there are more people walking or riding their bicycles to work on the paths adjacent to the roads I’m on.

In fact, on several occasions, I’ve taken my bike into work as well – 8 to 10 miles each way, depending on which path I take – something I never would have thought to do if high gasoline prices weren’t starting to affect my bottom line.

It will be interesting to see how these numbers change as the major car manufacturers adjust to the fact we no longer have a significant demand for trucks, SUVs and other gas guzzlers, and start producing more fuel efficient vehicles.

However, because we’re in the midst of a relatively seismic shift in energy/environmental awareness, even with more gas friendly cars available, it wouldn’t surprise me if the number of people walking and/or riding more continues to increase for an extended period of time.

Maybe we can knock out our energy and obesity problems at the same time!

Online Gas Price Sites – Do They Really Save You Money?

With the national average price of gasoline holding steady above $4 per gallon, it seems as if more and more people are using online gas price sites like and to help determine where they’re going to go to fill up. While there’s certainly plenty of satisfaction in knowing you’ve picked up the cheapest gas in the area, is it possible that these sites are actually causing you to spend more on gas even if you’re paying less at the pump?

Confused? Let me give you the following example:

You drive a car that gets, on average, 20 miles per gallon and has a 10 gallon tank. Before leaving your house to fill up the car, you check out and see that the gas station closest to your house, which is only a mile away, is selling regular unleaded gas for $4.15 per gallon; however, another station that’s only six miles from your house is selling regular unleaded gas for $4.00 per gallon.

Certainly, it would be a no brainer to go to the $4 per gallon station. After all, assuming you have to fill up all 10 gallons, you’re going to save yourself a whopping $1.50:

$4.15 – $4.00 = 15 cent savings per gallon x 10 gallons = $1.50 savings

Now, if this is where the analysis stopped, you’d probably be feeling pretty good about your decision to go to the farther away station. I mean, $1.50 doesn’t seem like much, but you’d much rather have it in your account than hand it over to the gas station clerk, right?

As I’m sure you’ve already guessed, this isn’t where the analysis stops, so let’s continue:

At 20 mpg, you’re burning 1/20th of a gallon of gas for every mile you drive.

1/20 x 2 miles (close station) = 1/10th of a gallon of gas used for the round trip.

1/20 x 12 miles (farther station) = 3/5ths of a gallon used for the round trip.

$4.15 x 1/10 = 41.5 cents in burned fuel to go to and from the closer/more expensive gas station.

$4.00 x 3/5 = $2.40 in burned fuel to go to and from the farther/less expensive gas station.

So, by going to the farther away gas station, here’s what your net savings actually ends up being:

$1.50 + $.415 – $2.40 = -$.485.

By driving out of your way to save 15 cents per gallon of gasoline, you actually end up being about 50 cents in the hole. Again, I know these numbers don’t seem like much, but wouldn’t you rather keep your money? Besides, over time, ever little bit adds up.

It’s probably unlikely that you’ll do this sort of analysis before you decide where to purchase your next tank of gas, however, it is something that you should probably keep in mind. Long story short, unless you’re going to save a significant amount on each gallon of gas, or you need to fill up a mammoth tank, its probably not worth it to go out of your way to purchase gas.

Fuel Economy Tip – The Two Mile Rule

There is little doubt that the recent spike in the price of gasoline has caused many Americans to change their driving habits. Whether it’s a drastic change like picking up and moving, or a more subtle change like making sure to drive the speed limit, chances are pretty good that we’ve all done something to help offset higher gas prices.

One way many people have tried to reduce the pain at the pump is by walking or riding a bicycle when they need to take “short trips.”

Considering a large portion of our driving is done within a close proximity to our homes and places of employment, implementing this change into your life could considerably reduce the amount of money you pay for gasoline.

I know some of you out there think this is a waste of time and isn’t worth trying out. So, for those of you who are skeptical of making such a change, I’d like to present to you the argument for the “Two Mile Rule.”

Very simply, the Two Mile Rule says that, when safe, you either walk or ride your bike when you’re going some place within a two mile radius of your home, work, etc. The only exception to this rule would be if you absolutely needed your vehicle – e.g. you’re going to the grocery store and are picking up way too many items to carry home.

Here are the three main reasons why you should follow the Two Mile Rule:

  1. You’ll undoubtedly reduce your gasoline consumption. Obviously, if you’re not driving your car, you’re not going to be using gas. Also, short driving tends to be marred by lots of stop signs, traffic lights, and needless idling, all of which do a great job of sucking gas and reducing your fuel economy. And, like I said before, it’s likely that much of your driving consists of these short trips. If you can eliminate these trips, you should see a significant savings.
  2. Less wear and tear on your vehicle. It doesn’t take a degree in mechanical engineering to know that the more you drive your car, the more wear and tear you put it through. So, if you can reduce the number of miles you drive, you should expect to increase your vehicle’s lifespan, which over the time you own the vehicle, could save you thousands of dollars in repairs, insurance and vehicle replacement cost.
  3. You’ll end up in much better shape. In addition to the health benefits, by losing weight you’ll increase your vehicle’s fuel economy when you do have to get behind the wheel. As you probably already know, for every extra 100 pounds you carry around in your car, you reduce its gas mileage by 2%. So, if you can find a way to lose 25 pounds by being more active (assuming you need to lose the weight), you should see a slight increase in fuel economy.

Over the last couple of weeks, I’ve started to incorporate the Two Mile Rule into my driving routine. Whenever possible I try to walk or ride my bike. I’ve even started riding my bike 16 miles round trip to and from work. A bit outside the two mile radius, I know.

While it was a pain when I first started, I’m certainly glad I kept with it. I feel like I’m in much better shape, I’ve dropped eight pounds and I’ve been able to add a couple of days to each tank of gas. And, considering my car’s starting to get up there in age, I’m hoping that I’m extending its lifespan as well.

On that note, give the Two Mile Rule a try. Your bank account, car and body will thank you.

It’s The Commute, Stupid

You’ll have to forgive me for the rather abrupt title, which is a ripoff of a James Carville inspired slogan for the 1992 Clinton presidental campaign, but I need it to make a point.

The point being: you can blame $4 gas on your morning and evening commute.

America has been built on the notion that personal transportation would always be relatively cheap. The most obvious example of this has been manifested in the exponential growth of suburbs and exurbs during the last two decades.

As we were pushed farther away from cities and their immediate suburbs – which, coincidentally, are where a vast majority of Americans work – and climbed into our cars – in many cases, a gas guzzling sedan, truck or SUV, and almost always by ourselves – we started to put into motion the scenario that’s playing out right now.

Invariably, the more we drove, the more fuel we consumed. Because oil is a finite commodity, the more we demanded, the more we tapped into the world’s ever decreasing supply.

In order to get a better idea of how far the average American commutes to and from work, I recently added a poll to Daily Fuel Economy Tip which asked the following: “How far is your commute (round trip) to and from work?” Here’s how nearly 200 people responded:

  • 29% have a commute that is longer than 31 miles
  • 28% have a commute that is between 11 and 20 miles
  • 25% have a commute that is less than 10 miles
  • 18% have a commute that is between 21 and 30 miles

If you were to assume that the average commuter vehicle on the road gets about 21 miles per gallon – which isn’t a stretch considering all of the trucks, mini-vans and SUVs on the road – then nearly half of Americans burn more than a gallon of gas per day just to get to and from work.

While that may not sound like much, over the course of a year, that’s over 18 billion gallons of gasoline, assuming a total workforce of 150 million individuals.

Back when oil was $25 a barrel and gas was $1.25, it didn’t really matter what type of gas mileage our vehicle got or how far we drove to and from work because at the end of the day, it wasn’t going to cost much to fill up. In fact, it cost so little to fill up that even driving a gas guzzling Suburban was probably just as cheap as using public transportation, not to mention the fact that it was much more convenient.

Unfortunately, it appears that this perpetuated even more driving, which continued to push up demand on what has become an increasingly limited supply.

Don’t forget, as our demand continued to grow relatively unchecked, our friends in developing nations such as China and India began to consume more oil, thanks in large part to growing middle classes that could now afford automobiles.

So here we are now, with oil pushing $135 a barrel, a national average gas price of just under $4 a gallon and a razor thin margin between the world’s supply and demand for oil.

Happy commuting.

How People Are Offsetting High Gas Prices

As gasoline prices continue to set record highs with each passing day – now nearing a nation-wide average of $4 per gallon, up nearly 30% in 2008 – more and more Americans are beginning to see a significant hit to their budget’s bottom line.

With little relief (if any) in sight, many Americans have started to make adjustments to help ease the sting of high fuel costs. Many drivers have made minor adjustments that have caused minimal lifestyle changes – such as reducing highway speeds – while others have had to make much more significant and life altering changes – such as take a job closer to home.

In order to gauge how most Americans are coping with higher gasoline prices, I recently included a poll on Daily Fuel Economy Tip which, very simply, asked the following: “What is the biggest thing you have done to try and combat high gas prices?” Here’s how nearly 200 people responded:

  • 33% stated they are driving less and/or using mass transportation more
  • 25% stated they are working harder to maximize their current vehicle’s fuel economy
  • 13% stated they’ve done nothing
  • 12% stated they’ve bought a car that has better fuel economy
  • 9% stated they’ve moved closer to work or taken a job closer to home
  • 8% stated they’ve done something not mentioned in the poll’s list

Based on the above results, nearly 9 out of 10 people have attempted something in order to try and offset record high gasoline prices.

In the end, hopefully there will be some good to come out of $4 (or $5, $6, etc.) gasoline.

Whether it forces us to reduce our driving, shift towards smaller cars with better fuel economy, force the Federal, state and local governments to offer better public transportation, etc., it’s clear that expensive gas is going to force significant changes throughout America.

While it may hurt (a lot) now, in the end chances are pretty good we’ll be better off in the long haul.

Have Sustained High Gas Prices Changed Your Driving?

Remember the last time the price of a gallon of gasoline was under $2.50 a gallon? While it may seem like it’s been forever, if you go by the national average price the date was March 3, 2007, which, from the date of this posting was exactly 229 days ago.

After years paying less than $2.00 per gallon, these higher prices have come as a shock to many of us, but have sustained gas prices above $2.50 per gallon been enough to force us to change our driving habits? According to a recent poll on Daily Fuel Economy Tip, it would appear that they have.

When asked, “Have sustained gas prices above $2.50 per gallon changed the amount of driving you do?” the responses went like this:

  • 39% of respondents said, “Yes, but only slightly.”
  • 30% of respondents said, “Yes, I don’t drive if I don’t have to.”
  • 26% of respondents said, “No, not at all.”
  • 4% of respondents said, “Unsure.”

Before you get on my case regarding the fact that the 69% people who responded to the poll and said they had adjusted their driving habits are probably already interested in maximizing their gas mileage regardless of what gas prices are – after all, they did take a poll on a site dedicated to gas mileage tips – it’s fairly apparent that higher gas prices would inevitably force many of us to make changes to our driving habits.

On the flip side, with demand for gasoline continuing to sit at or near all-time highs (as evident by the fact American gasoline inventories have remained relatively flat for quite some time) it’s hard to imagine that we’re really making a concerted effort to drive less and save gasoline.

I hope the results of the poll aren’t just lip service, but it appears that may be the case.

But with $90 dollar oil right around the corner – it hit $89 today – in all likelihood higher gasoline prices can’t be that much further behind.

Considering gasoline prices have remained right around $2.75 per gallon over the past two months (even with the switch to the cheaper winter blend), I’m sure we’re about to see whether or not sustained gas prices above $3 per gallon will have an even more dramatic effect on our driving habits.

Climate Change Bill Proposes 50 Cent Fuel Tax

It looks like the days of “cheap” gasoline are finally over.

I’m sure you’re probably sitting there rolling your eyes and saying to yourself, “$2.80 gasoline isn’t cheap.”  Comparing today’s prices to historical U.S. prices, yes, you’re right.  However, when you compare the price we pay here in the U.S. against what people in other “developed” nations pay, we’re getting a pretty good deal.

One of the main reasons behind our relatively inexpensive gasoline is the fact that it isn’t very heavily taxed.  However, it appears that may be about to change.

Under a new bill that’s being kicked around in the House, a 50 cent per gallon tax could be phased in over the next five years in an attempt to get people to drive less and consume less fuel.

Interestingly enough, both regular diesel and biodiesel fuels would be exempt from the tax due to the fact they produce less harmful emissions than their gasoline counterpart.

It has long been theorized that the only way to really get Americans to drive less or purchase more fuel efficient vehicles would be to hit them in their wallets.  This bill would do exactly that.

For example, let’s say you fill up your 10 gallon tank once every week.  If this bill were passed, you would be paying an extra $260 a year to fill up, once the 50 cent tax was fully phased in.

I like the idea of increasing fuel taxes, but it seems to me that this would unfairly punish people who have low incomes.  I don’t think a 50 cent per gallon tax would cause someone making $100,000 per year to think twice about driving, but I think it would certainly cause someone who makes $25,000 per year to think twice about driving.

However, something tells me even if this bill were passed in both the House and the Senate that it probably wouldn’t make it out of the Oval Office.

Did You Drive Less Than 200 Miles Today?

Thanks to sites like Digg and Hugg, recently I’ve seen several stories regarding the possible return of the electric car, I thought it might be worth it to do a quick sanity check to see if these vehicles would actually be viable for most of us.

It seems to me that the most common knock against the electric car is the fact that most of them can only go 200 to 250 miles – which is more than a round trip from New York to Philadelphia – between charges.

While I don’t think that most of us drive more than 200 miles each day, I figured it was safer to ask than to just assume.

So on that note, I recently put up a poll on Daily Fuel Economy Tip, which asked, “How many miles do you drive on an average day?” and it appears that, on an an average day, an electric car would probably be able to fit our needs.

Here are the results of the poll:

  • 45% of people drive 25 miles or less per day
  • 23% of people drive between 26 and 50 miles per day
  • 20% of people drive between 51 and 75 miles per day
  • 7% of people drive between 76 and 100 miles per day
  • 5% of people drive more than 100 miles per day

By the looks of it, it appears that roughly 95% of us would have no problem traveling under 100 miles per day, let alone 200 miles per day.

This sounds like a pretty compelling argument for electric cars for a couple of reasons, namely:

  1. You probably wouldn’t have to worry about the infrastructure of setting up random “charging stations” because, for most people, they could make it through the day on one charge and simply recharge their car at night.
  2. Commuting to work is probably the largest factor in why most people drive so few miles each day. Last time I checked, if it’s just you (and maybe another passenger) you’re probably not going to need to drive a big sedan or SUV to get to work, and a smaller car would probably do just fine.

Hopefully the realization by both consumers and manufacturers that we really do most of our driving on a local level will help get electric cars and plug-in hybrids to the market that much quicker.

Commuting Is Starting To Add Up

One of the major reasons why many Americans have been hurt by the recent 40% run up in the price of gasoline is because they simply have no other choice than to drive their cars to work. And, according to a recent survey on Daily Fuel Economy Tip, due to the distances we commute it appears that many Americans are going to become more and more affected by higher gas prices.

When asked, “How many miles do you commute to work?” 38% of respondents stated that their commute into work is between 11 and 25 miles; 35% stated their commute is 10 miles or less; 21% stated their commute is greater than 25 miles and 6% stated that they are telecommuters.

While these numbers may not appear that overwhelming, over time the amount of gas and money you spend to simply get to and from work is pretty astounding. For example, let’s say you commute 50 miles round trip each day and you drive a car that gets, on average, 20 miles per gallon. Each day you’re using about 2.5 gallons to get to and from work and at today’s national average gas price of $3.22 that would mean you’re spending about $8 a day for gas.

Over the course of a year, you’re looking at spending over $2,000 on gas over the course of a year just to get to work!

Just imagine if gas prices hit $4 per gallon, as many experts expect.

Unfortunately, because of the way that America’s infrastructure is set up, this doesn’t look like it’s going to be an easy, cheap or quick fix. While most of Europe is built around cities with very good public transportation systems, much of America is built around the idea of living in the suburbs and then commuting into a city or large town to go to work.

Because of the higher gas prices, many people are having to choose between selling their home and moving closer to their job or staying where they live and trying to find a job closer to home. Unfortunately, the slowing housing market is only adding to many people’s problems – but that’s a discussion for another day.

Either way, as gas prices continue to rise, it appears that more and more people are going to have to begin to change their driving habits and lifestyle. While this isn’t necessarily a bad thing, I think it’s going to come as a shock to many of us.

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