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Thursday, May 5, 2011

SO YOU WANT TO COMPLAIN ABOUT THE PRICE OF GASOLINE?

Gasoline is at an all time high in Hawaii.  Today, regular gas in Hawaii is at $4.59/gallon and premium at $4.74  When oil was  $147/barrel in July of 2008, the price was $4.51.  Let's see now, if oil costs "only" $100/gallon today, why are we breaking our all time record?  Further, the USA regular average is $4.01/gallon and $4.24/gallon for premium.  Thus, our prices in Hawaii are about 11% higher than the mainland.

Look at it this way:

1.  In April2011, the price of gasoline in Germany was $9.10/gallon, Netherlands $9.21/gallon and USA $4.03/gallon.  Gasoline is always more expensive in Scandinavia, but let's say gasoline in Europe averages $9.15/gallon.  Thus, gasoline in Europe is 227% that of the USA.  The difference is the additional tax drivers on the Continent bear.  Are they complaining?  There were trucker strikes two years ago, but recently, not much grumbling.  Beneficially, this elevated resulting in the average car mileage there at 40 miles/gallon, which is just about double that of the U.S.

2.  The average price of electricity in the U.S. is 11 cents/kWh.  In Hawaii?  About 33 cents/kWh.  This means we are paying 300% more for electricity.  European electricity prices are all over the map, but in the range of 15 cents/kWh to more than 40 cents/kWh.

So, why do we complain so much about gasoline, which only costs 11% more than the national average (plus, we only pay half what they do in Europe), when it is electricity, where we are burdened with 300% that of the USA, that should get our attention?  CAN ANYONE EXPLAIN TO ME WHY??????

Well, all the above will certainly change, anyway, for the price of oil dramatically sunk today, with the NYMEX at one point dropping below$100/barrel, closing at $100/barrel.  The Brent Spot is similarly declining, now at $112/barrel.  Last month I reported that Goldman Sachs predicted that oil would fall by $20/barrel by next Spring, and it is just about almost happening now.

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