2008-2009 Gas Prices
If American consumers examine 2008 and 2009 gas prices, they might easily come to the conclusion that national politics possibly play a role in determining what a gallon of gas will cost. Certainly there are other factors, but study the data on U.S. Retail Gasoline Prices as compiled by the Energy Information Administration (EIA). The information clearly and graphically shows gas at its highest prices approximately 100 days before the presidential election of 2008, then plummeting to its lowest price in about 2 years some 15 days after the election. Consumers, already bearing the brunt of a stagnant economy, see more than just a coincidence.
According to EIA figures, the national average for the price of a regular gallon of unleaded gasoline reached $4.12 in July, the highest figure for all of 2008. The increase was higher, and more prolonged, than many "experts" had predicted. Four months earlier, in March, noted industry analysts were calling for a peak of around $3.75 to be reached sometime in May. (Those same analysts did state that there would be some areas where gas would be over $4 a gallon.) The discrepancies between the prognostications and reality serve as evidence of the unpredictability (some would say instability and volatility) of the current oil market(s).
But the price of gasoline has always been about more than the cost of refining crude oil. At base, there's the price of a barrel of oil, which is responsible for 80% of the cost of a gallon of gasoline. Where you buy your gasoline also has a lot to do with price; gas costs more in major metropolitan areas than it does in less populated parts of the country. The price of gas takes on an even greater concern when one gauges its effect on other businesses and industries, most notably car insurance. Car insurance rates are directly related to the amount a motorist drives; and that driving is greatly, if not wholly, determined by the price of gas.
So far, 2009 has been markedly different from 2008. On average, gas is about $1 a gallon lower now than at this time in 2008. (Chicago and some areas among the Mid-Atlantic States see a drop of about $1.50.) Since May of 2009, average prices have been fluctuating between the $2.50 and $2.80 per gallon range. Currently, it appears doubtful there will be a return anywhere near the over $4 a gallon high that topped 2008 gas prices. Consumers, however, are adopting a cautionary mode – 2010 is an election year.