Economic Impacts of Rising Gas Prices

Despite the increase in price for a barrel of oil, economists have expressed mixed views of the economic impact. Taken as a whole, Americans are shown to be "better off" today than they were during the 1980s gas crisis. As the price per barrel rose, economists warned of the rising risk of recession. However, numbers indicate typical Americans wages more than cover their fuel needs when compared to those nearly thirty years ago. While it once took 105 minutes of work to pay for gas, Americans now average 52 minutes to cover fuel needs. The decrease generally correlates to improved fuel efficiency, increased refinery output and higher wages.

The analysis, however, looks extremely bleak when applied to the nation's poverty line. A recent study indicates America's poor effectively pay eight times more for fuel than the wealthy, an effect attributed to the limited availability of public transportation and greater commuting distances. In this economic class, nearly 13% of annual income is required to fill gas tanks. When looking at the census bureau data to determine the percentages, one of the researchers remarked, "'How do people live on $17,000 a year?"