U.S. gas prices lower than those in many other nations


Published/Last Modified on Saturday, May 31, 2008 3:05 PM MDT


PARIS — Americans are shell-shocked at $4-a-gallon gas. But consider France, where a gallon of petrol runs nearly $10. Or Turkey, where it’s more than $11.


Drivers around the world are being pummeled by the effects of record gas prices. And now some are hitting back, staging strikes and protests from Europe to Indonesia to demand that governments do more to ease the pain.

It’s a growing problem in a world that’s increasingly mobile and more vulnerable than ever to the cost of crude oil, which is racing higher by the day and showing no signs of stopping.

“I don’t know why it is, but ... it hurts,” said Marie Penucci, a violinist who was filling up her Volkswagen to the tune of $9.66 a gallon at an Esso station on the bypass that rings Paris. As she pumped, she looked wistfully at a commuter climbing onto one of the city’s cheap rental bicycles, an option not open to her since she travels long distances to perform.

As oil soars, the effect on drivers can vary widely. Taxes and subsidies that differ from nation to nation are the main reasons, along with limits in oil refining capacity and hard-to-reach places that drive up shipping costs.

In Europe and Japan, for example, high taxes have made drivers accustomed to staggering gas prices. As a result, plenty of European adults never even bother to learn to drive, preferring cheap mass transit to getting behind the wheel.

Those who do drive are still testing new pain thresholds. And it would be worse in Europe if the strong euro weren’t cushioning the blow.

On the other hand, in emerging economies such as China and India, government subsidies shield consumers.

But that still means governments themselves have to find a way to afford the soaring market prices for oil.

Increasingly, people around the world are reaching the boiling point — and it’s not just drivers.

Fishermen in Spain and Portugal began nationwide strikes Friday, keeping their trawlers and commercial boats docked at ports. In Madrid, demonstrators handed out 20 tons of fish in a bid to win support.

The world is driving more than ever: There are 887 million vehicles in the world, up from 553 million just 15 years ago, according to London consultancy Global Insight. It estimates the figure will be 1 billion four years from now.

In Europe, the high tax burden means crude prices make up a smaller part of the retail cost of gas.

The United States, with its relatively low taxes, is considered to have retail prices closer to what energy data charts call the “real cost” of gasoline — closely linked to the price of oil.

Comments

    av wrote on May 31, 2008 3:19 PM:

    " We should just get in business with Caracas, Venezuela where gas is only approximately .20 cents per gallon. Oil shortage my ***. "

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