Whenever gas prices run up as they have recently, gas becomes the replacement for small talk about the weather.
‘Can you believe those gas prices?’ It calls to mind the time several years ago when the national average hit $4.11 at the pump.
For the typical family, the percent of your budget you’re spending on gas is now 4%. Ten years ago, it was 2% of a family’s budget. At the same time, the amount of gas we’re consuming as a nation is going down, down, down.
So what’s going on?
The reality is the ball is not in our court anymore. The ultimate arbiter of price has become rapidly growing economies like China and India.
When I first went to China in 1983, everybody was either on foot or on a bike, except for the Red Army who drove around in vehicles. Then when I went back to China a few years ago with my team for a staff trip, there were cars everywhere in the cities, but not so much in the rural areas. Now China is the largest auto market in the world, so I’m betting even those lonely freeways in rural areas are seeing more vehicular traffic today.
Throughout much of our lifetime, we in the United States were the only important player in terms of energy on the world stage. That’s no longer the case. We’re still a factor, but we’re not the controlling one. We’re really just spectators to whatever the price of oil and gas does as Third World economies start industrializing at a faster and faster pace.
So you and I need to know what we can control and what we can’t. What we can’t control is the price of oil and gasoline. What we can control is how much of it we consume.
When it’s time to buy your next vehicle, you may want to look at a fuel-efficient ride to reduce your dependence on foreign oil. Don’t over-react and buy something smaller than would fit your lifestyle. That’s a false victory because you’ll be miserable every mile you drive. But within vehicle types, there is so much choice when it comes to fuel efficiency.