I have been hearing a lot of chatter on Twitter and the Web about gas prices lately, especially in the last twenty-four hours. I, like millions of other motorist, are very familiar with the price of gas as it has been slowly creeping its way up on the price scale. Why now has there been a huge serge in fossil fuel prices that kicked in yesterday, and why now has the media, and everyone else, just started to care about it?
I think part of the answer is in the trend itself. It has been steadily climbing ever since the economic meltdown back on 2008. With this slow, or fast creeping rise, depending on how you look at it, this trend in the cost seems to be now effecting us disproportionately more so. This could be the breaking point?
Last night I heard that the flooding of the Mississippi River had “spooked” everyone who cares about the markets of commodities, and they then speculated that the cost of fuel should rise as a hand full of oil refineries along the river’s bank will be shut down. That, coupled with the unrest in the Middle East, are said to be what has caused this sudden drop, and then rise in prices are our gas pumps. This according to the CBC News.
We have food prices creeping upwards too, although how much of it is directly effected by fuel prices is uncertain to me, but the cost of some food stuffs is mind boggling. Tomatoes are a weird food commodity as I have seen a two hundred and fifty percent rise, while coffee has climbed about fifty percent. Then there are the smaller packaging by food processors too – to trick consumers that cost are normal. These are increases that I have observed at my local grocer here in Langley Township from comparing receipts over the last twelve months.
The really big factor is the recovering market from the 2008 meltdown. Growth is still slow in Canada, and the unemployment rate is still something to be concerned with. Corporations are said to be stock piling their cash reserves, so a good chuck of the “trickle down” effect is very slow in returning back to the mainstream according to CBC News. And of course, debt is the number one cause of consumers, businesses and governments from getting back on track with their austerity measures. This all seems to me to be the recipe of a very slow recovery, and possible the “double-dip” recession that everyone keeps talking about.
Since I love statistics, and like to graph out everything I find so that I can visually see the effects, I have put together a couple of charts, courtesy of GasBuddy.com. You can got to their website and play around with the chart, imputing your data ranges and compare your ranges to your heart’s content. The program is limited, but serves its purpose nicely.
Click on the chart to make it bigger. The above chart is comparing the Canadian average, in litres per CND Currency-60 month range, of gasoline prices, in Orang. The Blue line is Vancouver’s price rate compared to Ottawa’s same performance. Vancouver’s rate is higher due to taxation, so the difference compared the national average and Ottawa’s is almost relative. Also look at the huge drop in the middle of the chart, 2008, and the slow creeping climb from 2008 up to now.
This chart compares the USA average, in Blue, to the Canadian average in Red. Again, taxation and government subsidies are responsible for the relative difference. Note too how close together the lines match up together during the 2008 melt-down, and how much farther apart these two trends seems to be afterwards. Keep in mind that a $1.50 litre is almost equalled to $5.68 a US Gallon.