Nolte: Soaring Gas Prices Force 61% of Americans to Cut Back Spending

[mystery-ak]

Nolte: Soaring Gas Prices Force 61% of Americans to Cut Back Spending

John Nolte 15 Mar 2022

“Soaring fuel prices have caused a majority of Americans to drive less and reduce spending in other areas of their household budgets,” according to the latest polling from Rasmussen Reports.

The poll found that “81% of American Adults say rising gasoline prices are a serious problem for their personal budget, including 56% who say higher gas prices are a Very Serious problem.” A mere “18% don’t consider the rising cost of gasoline a serious problem.” Must be nice.

Just as troubling is the effect of exploding gas prices on people’s spending habits. When people stop spending, recessions happen.

When asked if the cost of gasoline has caused them to drive less, 59 percent said yes, while only 36 percent said no.

Here’s the area that could spell the most trouble for the economy…

“Has the rising price of gasoline caused you to reduce spending on other purchases or activities?” A full 61 percent said yes, while only 35 percent said no.

This poll also backs up reports that black Americans are being hit the hardest. On the question of how serious a problem gas prices are, 63 percent of black respondents said “very serious,” compared to 57 percent of white respondents.

Spending creates demand, which creates commerce, which creates jobs in manufacturing, transportation, and retail. Spending is what drives the economy, and when people stop spending, the economy stalls.

Gas costs more now than at any time in our history. Where I live it’s $4.19 a gallon. Diesel is $5.09!

more
https://www.breitbart.com/politics/2022/03/15/nolte-soaring-gas-prices-force-61-of-americans-to-cut-back-spending/

[Hoodat]

Nolte: Soaring Gas Prices Force 61% of Americans to Cut Back Spending

If only that applied to government.

[Free Vulcan]

Right on point.

[Fishrrman]

In the meantime, the cost of West Texas crude has dropped back down below 100 -- 96.44 a few moments ago.

When will this downward change be reflected in the pump price...?
My guess is... don't hold your breath.

Having said that, rising gas prices don't really affect me significantly.
I don't drive much any more, and if I have to pay more to fill up when the tank drops down to 3/4, well... I just pay.

[DCPatriot]

Even though I'm a dyed-in-the-wool Capitalist who's familiar with bottom lines, still have a problem with gas stations raising the price of gasoline which is already delivered.

They shouldn't treat their inventory as a futures commodity.

Oh hell, who am I kidding?       

[libertybele]

In the meantime, the cost of West Texas crude has dropped back down below 100 -- 96.44 a few moments ago.

When will this downward change be reflected in the pump price...?
My guess is... don't hold your breath.

Having said that, rising gas prices don't really affect me significantly.
I don't drive much any more, and if I have to pay more to fill up when the tank drops down to 3/4, well... I just pay.

I don't drive a whole lot anymore either, but I feel for those that have to drive any significant distance to get to and from work.

Of course, it's just not gas going up; it's food, meds, insurance, clothing, taxes, etc....

It's becoming ridiculous -- and the DEMS aren't done destroying our economy, crushing jobs and making us march to the beat of their drum yet.

[DB]

Even though I'm a dyed-in-the-wool Capitalist who's familiar with bottom lines, still have a problem with gas stations raising the price of gasoline which is already delivered.

They shouldn't treat their inventory as a futures commodity.

Oh hell, who am I kidding?       

Something is worth what it cost to replace it.

When prices go down can they continue to charge a higher price for what was already delivered and still make the sale? Especially when the sign across the street is significantly lower?

[roamer_1]

We're still working out of the 2 dollar/gal gas stored up at the ranch... Those tanks will need filling some time around late spring / early summer. I ain't looking forward to that bill

[Hoodat]

Even though I'm a dyed-in-the-wool Capitalist who's familiar with bottom lines, still have a problem with gas stations raising the price of gasoline which is already delivered.

They shouldn't treat their inventory as a futures commodity.

Oh hell, who am I kidding?       

The gas they are selling will have to be replaced.  Theirs isn't a one-time transaction.  When the price goes down, they will end up selling gas at or below cost in order to refill at a cheaper price.

[catfish1957]

In the meantime, the cost of West Texas crude has dropped back down below 100 -- 96.44 a few moments ago.

When will this downward change be reflected in the pump price...?
My guess is... don't hold your breath.

Having said that, rising gas prices don't really affect me significantly.
I don't drive much any more, and if I have to pay more to fill up when the tank drops down to 3/4, well... I just pay.

Yeah, I may have been a member of the evil oil company club.  But there are a lot of market forces at work involved with the price at the pump that decouple themselves from spot commodity WTI pricing.   Let me give somewhat of a run down.

1.  When you see crude, that is the entire complex crude mixture of carbon that in it's extracted state contains C1 (methane) all the way to C40 (asphalt like).  The gasoline fraction generally is C4/5 through C10. Every other carbon has its own market that is driven by its own market forces.  That is why WTI or Brent is never a good direct correlatable number.

2.  Realize that M&R (marketing and refining) is based on a a blended average purchases over an extended period.  Do you realize that in that recent run up, when oil reached $140/bbl, which was roughly a 60% increase over 2 weeks, and that if those numbers were truly correlatable that gasolne prices would have been generally in the $10-12 /gallon range.  No it did not rise that quick, just for the same reason it won't fall that quick.

3.  90+% of the population of this country underestimates how badly Biden has hamstrung the oil industry in the ability to secure new permits, expand operations, impose stringent enviornmental controls, and has become an absolute hostile combatant as far as dealing with in any manner of governmental interaction. Oil companies respond in a manner that adjusts for that hostility, and response that the Biden administration is serious in its intent to destroy them.  Any company of any competence is going to shrink and contract in business environments of the sort. 

4.  I don't know where you live, but in most states, Gasoline is the most incrementally taxed product we have on earth.  Factor that in when seeing the price of the pump.

5. In 90% of the business of oil. the big money is made finding, drilling, and extracting product.  Right now, in Biden's quest to destroy oil, he is at least giving them a brief life line.  Because of his policies the age old axiom of supply/demand has forced the product to price escalate in almost historical levels.  From there, also realize that the aspects of transporation, refining, and delivery of product are incrementally added and fixed.  Again, biggest share of profit is in the front end.

6. And to add OTOH, don't forget that in May 2020, the price of oil fell to negative numbers, and there was a lot of speculaton that many players in the industry would not survive.  Even the big companies were losing 10's of billions of dollars per quarter in that historic crash.

The oil industry is among the most conservative businesses we have in this country, and they reside in mostly red states.  That is no accident why the left and the democrats despise them so much.

[DB]

Doesn't the government make more in taxes on a gallon of gas than those who produce it?

That says a lot right there.

[catfish1957]

Doesn't the government make more in taxes on a gallon of gas that those who produce it?

That says a lot right there.

If you are an independent refiner or are making 3rd party purchases from state run oil companies?...  Yep.

[GtHawk]

It's not that I am cutting back spending, and I doubt most Americans are, it's that I no longer have any money left to spend after covering the basics and the way things are going I am going to have to make decisions on which basics I will have to do without.

[IsailedawayfromFR]

I think a lot of people may be cutting back on spending not because of the money spent on gasoline, but an overall fear of what is coming from the inflation/recession outlook developing.  Money made is being diverted to cash or savings or to stock up on necessities like food that will be scarcer in the near term.

As an example, I went our and bought several hundred dollars worth of fertilizer as I see a doubling or tripling of prices coming, if one can even get it.

The luxuries of boating excursions and travel or considering a new car are behind me as I am building a foundation to withstand the storm brewing.

[catfish1957]

I think a lot of people may be cutting back on spending not because of the money spent on gasoline, but an overall fear of what is coming from the inflation/recession outlook developing.  Money made is being diverted to cash or savings or to stock up on necessities like food that will be scarcer in the near term.

As an example, I went our and bought several hundred dollars worth of fertilizer as I see a doubling or tripling of prices coming, if one can even get it.

The luxuries of boating excursions and travel or considering a new car are behind me as I am building a foundation to withstand the storm brewing.

I had grand plans to build a fish pond at one of the places a few years ago, and I am now kicking myself for not going through with it.

It's warm enough here, and if I had built it deep enough, I could have sustained 20 people with Tilapia alone.