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Coping with the Rising Price of Gas

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Updated September 10, 2005

by Lisa Terry McKeown

POPE AIR FORCE BASE, N.C. -- Master Sgt. Tony Frazier was just doing what anyone else would do when running low on gas -- he went to the gas station, pulled up to the gas pump and filled up his car’s tank. Before he knew it, the price on the pump read $43 and climbing.

“I must have looked silly standing there with my mouth open (in shock of the price),” said Sergeant Frazier, assigned to the 43rd Security Forces Squadron here. It took him $51 to fill up his car from a quarter tank -- and that was before Hurricane Katrina hit and prices jumped above $3 a gallon.

Sergeant Frazier is not alone in his “sticker shock.” For some, the rising prices are annoying at most, but for others the cost of just getting to work and back is cutting into their ability to keep up with monthly bills.

In an August 24 survey of more than 100 Airmen here, 89 percent said that the extra $50 or $60 it now takes to fill up their vehicles is having an affect on their pocketbooks.

“It’s comparable to paying an extra bill that you were not expecting to have,” said Master Sgt. Melissa Cooper from the 43rd Aeromedical Evacuation Squadron.

With regular gasoline costing $3.07 as of Sept. 7, North Carolina’s prices are above the national average. In fact, state gasoline prices are up 226 percent compared with one year ago when the average price was $1.36.

Money that usually might go toward a night out with friends, groceries, clothing or into a savings account may now have to be rebudgeted into transportation costs.

Americans use more than 840 million gallons of petroleum products every day, according to the Department of Energy. Almost half of that is in the form of gasoline used in more than 200 million motor vehicles. The U.S. is the biggest consumer of gasoline in the world and imports almost two-thirds of its oil supply from other countries.

The Gulf of Mexico produces about 7 percent of the nation’s oil demand, and almost 95 percent of that production came to a standstill when Hurricane Katrina barreled through the area, according to the U.S. Minerals Management Service. That does not include oil refineries that were also closed during and following the storm.

So it was no surprise to many when the cost of gas soared after the hurricane devastated such an important energy hub. The concern now is if the price will go down or continue to rise.

In the poll conducted here, 83 percent of the Airmen think that gas prices will keep climbing with or without the hurricane’s price factors. They may be right. The price of gasoline is directly affected by the price of crude oil, world supply and demand, taxes and world events.

The Department of Energy reports that for every dollar increase in the cost of a barrel of crude oil, there is an average increase of about 2.5 cents per gallon of gasoline. The price of crude oil jumped to a record $70 per barrel after the hurricane.

Crude oil costs fluctuate dramatically and are often based on the political stability in oil production areas. The cost also depends on world-wide supply and demand.

Over the years, the United States did not have as much competition for the amount of oil required to meet national need. As economies boom across Asia, however, the global supply is struggling to keep up with the demand, causing prices to rise.

Taxes also add a significant amount to the price of gas. Although state and local taxes vary, federal excise taxes are 18.4 cents per gallon. When included with an average state tax, it brings the nationwide average tax on gasoline to 42.7 cents per gallon. North Carolina’s overall tax lies just above the average at 43.3 cents per gallon.

All of this leads to a simple conclusion -- it is expensive to drive, and more expensive to keep buying gasoline.

In the meantime, Airmen can reduce their personal fuel costs and get the most out of a tank of gas by following a few simple tips:

    -- Use the right grade of gasoline.

    -- Limit driving time by combining short trips around town into one round trip.

    -- Avoid making quick starts or stops.

    -- Drive the speed limit. All vehicles lose fuel economy at speeds above 65 mph.

    -- Carpool, ride the bus, bicycle or walk instead of driving alone.

    -- Regular vehicle maintenance can decrease your fuel cost by up to 13 percent.

    -- Minimize vehicle idling.

    -- Eliminate extra wind resistance and weight from your vehicle.

    -- If you own more than one vehicle, drive the more fuel efficient one more often.

    -- Shop around for the cheapest price

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