SAVE   |   EMAIL   |   PRINT   |   RSS  
On the (oil) wagon?
Looks like high gas prices are curbing our oil addiction ... but relapses happen.
September 16, 2005: 3:03 PM EDT

Sign up for the Eyeopener e-mail newsletter

NEW YORK (CNN/Money) - For years cynics in the economics profession ... or perhaps, realists ... have said that high oil and gas prices would be one of the best things that could happen to this country because they would force us all to use less energy and make better, more efficient choices.

Well, at long last, it appears that what alarmist scientific analysts and ardent environmentalists could not achieve is being wrought by gas at $3 a gallon, and oil well over $60 a barrel.

More people are dropping gas guzzlers in favor of gas savers, according to analysis by a unit of J.D. Power and Associates for USA Today.

The study says that 9.4 percent of van owners bought small cars in August, and that was up from 5.9 percent of van owners in August of 2004. As for SUV owners, 8.7 percent opted for small cars last month, up from 5.5 percent a year ago.

Also out today, a survey showing that eight in 10 people say it's important for Americans now driving sport utility vehicles to switch to more fuel-efficient modes of transportation to reduce U.S. dependence on oil.

The poll taken by the Pew Center Research for the People and the Press also found six in 10 who don't think President Bush is taking the right approach to solving the problem. Of course those six could include everyone from those who wants us to hail rickshaws instead of taxis, to those who think we ought to make Saudi Arabia the 52nd state in the union to ensure access to cheap oil and gas.

Here's an idea that sounds ill-advised to me: nearly 7 in 10 in the Pew Survey want the government to put price controls on gasoline. They also want more spending on subway, railway and bus systems, which would be a good idea if people would use them more and so far most Americans use cars over buses just about every chance they get.

The big question that cannot be answered is how long this change of gas-guzzling heart will last if gas prices level out below $3 a gallon, or even fall closer to $2 a gallon for awhile?

It seems almost impossible now but back in 1998 the price of gasoline fell back towards ONE dollar a gallon in much of the country for awhile. And it was that low level of gasoline prices, and a crude oil price that hovered around 20 to 25 dollars a barrel on average for several years that enabled and encouraged the era of the big SUV.

"Oiloholics" is how a recent cover of The Economist magazine referred to the U.S. and China recently. Yes, we've been on a binge and some of us want to start drying out.

But it could be that the recent change in sentiment will turn out to be as temporary as all the promises to behave better next time that people make the morning after as they nurse a bad hangover, and that the gas-guzzling party start all over again if and when the current high prices fade.


Kathleen Hays is economics correspondent for CNN. You can read more of her columns here.  Top of page

Kathleen Hays
Oil and Gas
Manage alerts | What is this?