The Liquid Disconnect
Well, one good thing about the current economic crisis is that the price of gas (or as I say - petrol) is going down. That's only good assuming you still have a job to pay for the gas, but that's a whole other story.
I find people's obsession with the price of fuel somewhat amusing, especially here in the US. At its most expensive, gas peaked at just over $4 a gallon. People were outraged.
The reason I find this particularly amusing in the US is because back in the UK, gas costs approximately four times what it does in the US. People were complaining how bad things were when really, they had no idea how GOOD they have it. If you can fill your car up for less than $60 - then that's a real bargain.
I've been thinking about this recently and wondering why people think their gas should be inexpensive. Why they expect it to be so. Think about it. Before your gas can get to the pump a whole host of things need to happen. The oil companies in the first instance have to prospect for oil, that means drilling lots of test wells at huge expense to find the oil in the first place. Once they find it, they then have to invest another huge amount of money to set up an oil rig/pump. Now the oil is pumping, they then have to put it in containers (which cost money) and transport it to a refinery (which costs more money). At the refinery, the gasoline then has to be extracted from the crude oil, re-barreled and then distributed all over the country/internationally. None of this takes into account the thousands of people who make all this happen who also need to get paid.
Despite the oil companies posting record profits year after year, it's fantastic that a gallon of gas ONLY costs a few dollars given the processes involved. Instead of us thinking cheap gas should be a right, we should be downright grateful that it's as cheap as it is.
This thought then sent me off on another tangent. If we're so upset about what we pay for gas, what about other liquid products that we purchase with no thought whatsoever as to the price.
I have compiled a short list of things that are routinely purchased and then done a price conversion as to how much a gallon of each of them would cost. It makes for some interesting reading:
Can of Soda ($1) - Gallon ($10.60)
Bottled water (anything from 3c to 8c per fl oz) - Gallon ($3.84-$10.24)
Liter of Milk ($3) - Gallon ($11.36)
Small Starbucks Coffee ($3) - Gallon ($31.80)
Now people can argue that the reason they get upset about fuel prices is because they have no choice but to buy gas, the oil companies, in effect, have them over a barrel (pardon the pun), but as you can see, gas is one of the cheapest liquid products you purchase. Why aren't we all up in arms about the cost of bottled water? What needs to be done to that besides some filtration and bottling? How is that price justified? How can we begrudge the price of a gallon of gas when we'll part with the same amount of money or more for just 1/10th of the same volume of coffee? Again, what process is involved in getting coffee to our stores that comes even close to the process that gets gas to the pump? The manual laborers who pick coffee beans probably make less in a month than you or I make in a day.
Personally I'm all for alternative fuels. The sooner we get away from oil and gas and stop choking the planet to death, the better, but seriously, the next time you want to complain about the price of gas, think about the last time you had a soda, or a coffee.
I find people's obsession with the price of fuel somewhat amusing, especially here in the US. At its most expensive, gas peaked at just over $4 a gallon. People were outraged.
The reason I find this particularly amusing in the US is because back in the UK, gas costs approximately four times what it does in the US. People were complaining how bad things were when really, they had no idea how GOOD they have it. If you can fill your car up for less than $60 - then that's a real bargain.
I've been thinking about this recently and wondering why people think their gas should be inexpensive. Why they expect it to be so. Think about it. Before your gas can get to the pump a whole host of things need to happen. The oil companies in the first instance have to prospect for oil, that means drilling lots of test wells at huge expense to find the oil in the first place. Once they find it, they then have to invest another huge amount of money to set up an oil rig/pump. Now the oil is pumping, they then have to put it in containers (which cost money) and transport it to a refinery (which costs more money). At the refinery, the gasoline then has to be extracted from the crude oil, re-barreled and then distributed all over the country/internationally. None of this takes into account the thousands of people who make all this happen who also need to get paid.
Despite the oil companies posting record profits year after year, it's fantastic that a gallon of gas ONLY costs a few dollars given the processes involved. Instead of us thinking cheap gas should be a right, we should be downright grateful that it's as cheap as it is.
This thought then sent me off on another tangent. If we're so upset about what we pay for gas, what about other liquid products that we purchase with no thought whatsoever as to the price.
I have compiled a short list of things that are routinely purchased and then done a price conversion as to how much a gallon of each of them would cost. It makes for some interesting reading:
Can of Soda ($1) - Gallon ($10.60)
Bottled water (anything from 3c to 8c per fl oz) - Gallon ($3.84-$10.24)
Liter of Milk ($3) - Gallon ($11.36)
Small Starbucks Coffee ($3) - Gallon ($31.80)
Now people can argue that the reason they get upset about fuel prices is because they have no choice but to buy gas, the oil companies, in effect, have them over a barrel (pardon the pun), but as you can see, gas is one of the cheapest liquid products you purchase. Why aren't we all up in arms about the cost of bottled water? What needs to be done to that besides some filtration and bottling? How is that price justified? How can we begrudge the price of a gallon of gas when we'll part with the same amount of money or more for just 1/10th of the same volume of coffee? Again, what process is involved in getting coffee to our stores that comes even close to the process that gets gas to the pump? The manual laborers who pick coffee beans probably make less in a month than you or I make in a day.
Personally I'm all for alternative fuels. The sooner we get away from oil and gas and stop choking the planet to death, the better, but seriously, the next time you want to complain about the price of gas, think about the last time you had a soda, or a coffee.
Labels: gas petrol oil expensive cheap inexpensive price coffee water soda milk economy
posted by An Englishman in New York at 3:37 PM
3 Comments:
Hmmm... I don't buy bottled water because in my opinion it is too expensive. Instead I just drink tap water after running it through a PUR filter. (Any idea how much tap water costs? My last bill indicates $15 for 2 "units" but doesn't specify what unit. Can't be gallons. I drink more than 2 gallons a month.)
Likewise, much cheaper coffee can be had by buying it at a grocery store and making it yourself. Same with smoothies, which I sometimes go for - $6 for a 20 oz from Smoothie King is pretty expensive when I could just buy a blender.
And I watch the prices of my favorite sodas the same way I watch fuel prices. Sales are awesome. One of the things I miss about Indiana is the cheap soda - there, I would get 24-packs of soda for $4. Here it's hard to find 24-packs at all, and they cost nowhere near $2 most of the time.
In conclusion, I don't think it's a fair comparison when you're picking examples from retail, where by definition they'll jack up the prices and clever marketing to turn a profit.
MWT,
Agreed, retail is sure to jack the price up on these things, the point I was trying to make is that people do buy these things, even if somewhat occassionally, yet they never seem to complain about the price of those things, even though they are grossly inflated.
That's because the people who would complain about it (such as myself) have the choice to not buy it (and probably don't). That's unfortunately not the case with gas for the vast majority of people. I would love to not have to buy gas - but there's no other way for me to get to and from work in a timely manner.
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