Reducing Gasoline Prices

There are three components to the price of gasoline at the pump. The first is the price of oil. This is influenced by market speculators, and especially when oil is in short supply or when world events suggest that it might soon be in short supply, the speculators smell profits and bid up oil prices. The second ingredient is the refining cost/capacity, and barring shutdowns of refineries, this is fairly constant. The third factor is the relationship between supply of gasoline and the demand for it. Of these three ingredients to pricing, consumers can only affect the supply vs. demand relationship. If you want lower gasoline prices, there are two things you can do: (1) Drive fewer miles, and try to use the vehicle that gets the best mileage if you have a choice between two. (2) Don't fill up your tank all the way. As of 2007, there were 254.4 million cars in the United States. If each of those cars were filled to a point six gallons less than full, and half the available cars were "filled" at any given time, the country would require about 762 million fewer gallons of gasoline at any given time. Since gasoline weighs about 6 pounds per U.S. gallon, stopping the pump six gallons below full would mean that you wouldn't have to pay for fuel to carry the extra 36 pounds of gasoline around. On the government and marketplace level, anything that could be done to discourage speculators from bidding up prices unrealistically would help also.

Gas Saving Tip

Here's a simple tip for reducing the amount of gasoline(petrol) you use. When you refuel, fill up your tank or purchase a constant number of gallons(litres) so that you know the amount of fuel you have to begin with. Before you leave the pump, reset your trip odometer to zero. When you do this, you will always know the number of miles(km) you have driven since your last refueling. Then remain conscious of the distance you have driven by watching the miles(km) on the trip odometer accumulate. You will find yourself reducing unnecessary trips to slow down the increase in the displayed number, and you will also soon learn how many miles(km) you can expect on your fill-up or constant amount of fuel purchased. This will tell you at any time what percentage of the way to your next refueling you are. Drive so as to maximize the time to your next refueling, and you will purchase less fuel and save money.

Gas Prices Going Down - Is That Good or Bad News?

To most of us the change to a recent downward trend in gasoline prices is great news. However, given the fickle nature of overconsumers and automobile companies, it may not be. How many times have the automobile companies learned that the long-term trend in fuel prices is violently upward, only to go for short-term profits with huge SUVs and high-power engines? How many times have high-income status seekers complained about gasoline prices and then bought those short-term-profit gas guzzlers to maintain their status and keep gas prices high for the rest of us?
Gas prices have started to go down for two reasons, and if we concentrate on those reasons, prices will continue to go down. The most basic reason is that $4.00-plus gasoline (Europeans, stop laughing. We know and appreciate that yours is much higher.) finally encouraged most drivers to cut back on the number of miles that they drive. If you continually evaluate whether a trip is necessary, run several errands in tandem, and drive your car that gets the best gas mileage, total demand for gasoline will decrease as will prices. The other reason for prices going down is that investors, seeing a slight upward direction to stock prices are starting to switch from driving up the market price for oil to investing again in stocks as a better long-term alternative. The problem with driving up the price for oil as an investment is that the resulting high-priced energy drives down all of your other investments, and you end up shooting yourself in the foot (Which you will need after high energy prices make us all walk or ride bicycles.). Of course, increased walking and/or riding bicycles will both decrease the number of total miles driven and start to make us physically fit again, so it's a win-win situation.

Save the Economy - Bring Back the Shmoo?

Al Capp, the ingenious creator of the "Li'l Abner" comic strip solved our economic problems in the late 1940's with his introduction of the Shmoo. The Shmoo was a cute pear-shaped creature which would do anything to make people happy. (Click on the title of this post for more Shmoo info.) It would lay eggs and milk, turn itself into a sizzling steak, or serve as a toy for young children. In today's world, I'm sure a Shmoo would be more than happy to become a tankful of gasoline. Shmoos multiplied at an alarming rate, so there was never a lack of Schmoos waiting to please you in some way. Sounds great, doesn't it? The problem is that we get lazy when everything is done for us, and we lose our capability to solve problems on our own. When times are good, we are more than willing to coast and accept things the way they are. Only in hard times do we maximize our resources and turn them toward solving the problems we face. Sometimes we have to take the doom and gloom out of bad news in order to look at it as an opportunity to solve some problems. Progress comes out of adversity. Fifty years from now when we are driving around in our magnetically levitated fuel cell powered two-passenger vehicles with modular storage add-ons, we will appreciate the incentive that we gained from high-priced gasoline. In the meantime, drive less, carpool, and be a Shmoo to all of your friends. (And don't misspell the word to be ornery...)

Restaurant Pricing

Did you ever notice that when you go to a restaurant the bill is roughly constant? My wife and I tend to go to moderate family restaurants, and the bill is almost always about $20.00 for the two of us before tax and tip. Restaurants of all types design their menus around the amount of money they wish to receive from each customer. In a typical family restaurant where we live, you can purchase an egg/pancake dish for $7.95, a sandwich plate for $7.95, or a dinner special for $7.95. To be sure, you can shave the price slightly by ordering only one egg or get a better dinner for a few dollars more. In addition, the pricing is biased by whether you order drinks, side dishes, or desserts, which are higher profit items.

Restaurants today are businesses which happen to serve food as their product, rather than hospitality centers where the main goal is to impress the guest with the quality of the food and service. The primary approach is to attract and process through as many customers as possible at a certain average dollar value per customer. This is usually done by compressing the range of prices on the menu as discussed above and by streamlining the process in order to get as many customers as possible through in a given period of time. The latter approach is the fast food philosophy.

It will be interesting to see whether the restaurant business starts to introduce some cost-reduction innovations now that gasoline prices are getting higher every day. The easiest way to compensate for the higher cost of gasoline is to eat at home, saving both the costs of driving and of the restaurant. Some restaurants are now packaging menu items as frozen entrees that you can purchase at the supermarket and eat at home. Is this the best of both worlds?

Transportation and Communication

Two sectors of the economy that are usually mentioned in a single sentence are transportation and communication. They are the twin facilitators that make the difference between living in a worldwide economy and living in a purely local economy. The latter situation was common and normal in the nineteenth century and earlier, and people lived their lives at a slower pace because of it. With the advent of accelerated oil pricing increases, whether due to shortages, increased demand, speculation, hedging, or sinister plots, we have to try to decrease our oil requirements by emphasizing communication over transportation. Fortunately, computers and the internet have been moving in the correct direction for this increased reliance on communication. It is much easier, quicker, and less expensive to keep in touch with people by e-mail than it is with postal mail. I have been involved with international commerce for many years with only a minimum of international travel. With the developing capability for video links and electronic conferencing who wouldn't prefer efficient communication over waiting in airports due to delayed and cancelled flights. A major tool for offsetting increased transportation costs definitely lies in improved communication, and we should all try to emphasize moving thoughts and words rather than bodies and physical objects whenever possible...Now if we could only do something about spam and telemarketing from the other side of the world, we'd really be doing a better job of communicating.

Ways to Reduce Your Gasoline Costs

In these days of extremely high gas prices you have to think about your car and your driving habits to save gasoline:

1. Fill gas tank halfway only. – Reduce the weight the car carries.
2. Combine your short errand trips. – Don’t make a single errand and return.
3. Design your route to maximize right turns. – Left turns take waiting and extra gas.
4. Keep your tire pressures up. – Less tire wear and better mileage.
5. Fill tires with nitrogen instead of air. – Maintains tire pressure longer.
6. Turn off engine if idling longer than 30 seconds – IF car is in good shape to restart engine.
7. Park in lot to pull out forward if possible. - Backing and maneuvering take extra gas.
8. Reduce the load in your trunk. – Extra weight requires extra gas.
9. Keep your car clean. – A smooth surface has less drag.
10. Telephone or e-mail rather than driving. – Reduce trips to reduce gas.
11. Move closer to your work to reduce commuting miles.
12. Carpool whenever possible.
13. Take public transportation whenever possible and practical.
14. Buy the lowest grade of gasoline that matches your car’s specifications.
15. Change your oil regularly and maintain oil levels.
16. Use synthetic oil for better lubrication.
17. If you have two cars, use the higher mpg car for long trips.
18. Schedule meetings near the midway geographical point among participants to reduce average travel mileage.
19. Use conference phone calls rather than having meetings.
20. Shop locally.
21. When you have alternate possible places to shop go to the nearest one.
22. Monitor prices and go to the gas station with lowest prices that is within a reasonable travel distance.
23. Reduce eating out. – This saves mileage and reduces your restaurant budget to increase your gas budget.
24. Ride a bike or walk for local trips.
25. Ask yourself, “Is this trip necessary?” – If not, don’t go.
26. Mow your lawn with an electric lawn mower.
27. Keep your car tuned and serviced properly.
28. Slow down approaching red lights. Time your approach to eliminate or reduce complete stops.
29. Use only moderate acceleration. Maximum acceleration wastes gas.
30. Take turns smoothly. Tight turns and stops/starts on turn waste gas and increase tire wear.
31. Cruise at 55 mph on highways. Higher speeds waste gas.
32. Try to maintain constant or slowly changing speeds whether local or distance driving.
33. Shop online or by catalog rather than by car.
34. Use online banking when practical.
35. Don’t idle your car for a long time to warm it up. – Start up and go.
36. Drive in dry rather than wet weather when possible. – Rain causes extra drag and worse friction control between tires and pavement. (same for ice/snow)
37. Don’t use drive-up lanes at fast food restaurants, banks, etc. – Too much idling.
38. Plan your trip to take bridges and underpasses where possible to avoid possible long waits at train crossings.
39. Use limited-access highways rather than local roads to maintain cruising speed and avoid multiple stops at traffic lights.
40. Avoid construction zones.
41. Get an I-Pass (EZ-Pass, etc.) when traveling toll roads to pay your tolls without stopping and waiting in line.
42. Put outgoing mail in your home mailbox for the mail carrier to pick up rather than taking it to a public mailbox or the post office.
43. Walk rather than drive your child to and from school or the school bus stop.
44. Don’t use your air conditioner unless you really need it. If you do use it, set the controls to recirculate the air inside the car. This will mean that the air conditioner cools air that has already been cooled, which uses less energy than cooling hot outside air.
45. Watch your tachometer to keep your rpm’s fairly constant. Generally, cruise rpm’s should be in the 1500 to 2000 range. If you are trying to save gas, they should never be much higher.
46. Use tires designed for highway driving rather than off-road tire types or snow tires (except when required for the conditions you are facing).
47. Avoid bumpy roads and potholed surfaces. – Your car can’t get good mileage if the tires are not in continuous contact with the road.

Gas Prices and Improved Cars

As the price of gasoline continues to rise, many people start to think about trading in their existing car for one that goes more miles per gallon of gas. When you do get such thoughts, make sure you look at the actual mathematics of the gas cost vs. car cost situation. Assume you are an average driver who might drive 12,000 miles per year. If you are consciously trying to limit your driving miles by such tricks as making many planned stops on a single trip rather than taking many individual trips, 12,000 miles per year is quite reasonable. Assume that your current car goes 20 miles per gallon of gas. If we assume that gas soars to a price of $5.00 per gallon, you would use 600 gallons per year for a cost of $3,000 per year. If you were able to trade in your car for one that has double the fuel economy, that goes 40 miles per gallon of gas, your annual gas cost would drop from $3,000 to $1,500. That's a good bit of savings. Now if you are going to keep your new car for five years, you have to find a new car that you can buy for the five-year savings, or $7,500 in order to spend the same for gasoline plus car costs as you would by continuing to drive your old car. Go ahead, enjoy your $7,500 new car if you can find it. If you want to pay even less than you are now paying, your new car would have to have an even lower price...And don't forget, this calculation was based on $5.00 per gallon gasoline. Perhaps "rusty but trusty" is the better solution until your current car has to be replaced for functional reasons.