The Oil Drum

107 comments on a linear extrapolation of oil consumption by demand growth, production growth, and demand elasticity

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LevinK on January 22, 2006 - 2:14pm

Let's see... an average driver goes 12K miles per year, which with 20 miles/gallon realistic fuel consumption is 600 gallons or about $1500 at current prices annualy. How much is this? 4-5% of the average income? In my home country people spend twice the same share for mass transit only, while owning a car would eat maybe 20%-30% of it. But people are still driving because you know that's what civilisation is all about...

IMO demand reduction in US will not come through high prices but through shortages. All things being equal people will continue driving even with 10$ gallon because there is simply no real alternative. Yes they will drive less but not that less than you think now.

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Gets IT on January 22, 2006 - 7:10pm

Amazing right Levin? When I was living in Houston, Tx, I ALWAYS drove MINIMUM 30,000 miles/year as long as I could find the gasoline. The OPEC 1976 crisis was the only thing that ever slowed that down. Couldn't get it for several days at a time and 4-5 hour wait in line. If I could fill the tank, I was movin' that Jeep 4WD Pickup and pulling a boat 175 miles 1-way each weekend to the fishin' hole. Most expensive fish I ever caught. I think they came in at about $40/lb when I caught fish. Sometimes that fish price hit infinity. Now, I live within 1km of the ocean, drive around 12,000 Kilometers each year. Price of gas got higher, price of fish went down, but now I can work and fish every day. No complaints here.