Feb 6, 2013 No Comments ›› Toro520
Despite increased efforts to get more drivers to adopt fuel-efficient vehicles, U.S. households spent the highest percentage of their income on gasoline in 2012 than they did in any other year in nearly three decades except for 2008, according to new estimates.
In 2012, average gas prices came close to $3.70 per gallon.
The EIA noted that while cars are more fuel-efficient today, gas prices have outpaced these gains in recent years. Overall gasoline use consumption fell in 2011 to 134.2 billion barrels, but average retail gas prices shot up 26.1 percent in 2011 and 3.3 percent in 2012. Rising gas prices greatly outpaced consumer income.
Gas prices in the last two years have also outpaced the growth in household income. The 2011 gas-price increase was six times greater than the 3.4 percent increase in nominal household income, according to EIA, and the 2012 gas price increase outpaced the 2.9 percent estimated increase in income for that year.
“The effect of the higher prices in 2011 and 2012 outweighed the effect of reduced consumption,” according to the EIA. “As a result, expenditures increased to a record annual average of $2,655 per household in 2011, rising to an estimated $2,912 in 2012.”
CNBC reported that prices at the pump are at record highs for this time of year, which means the country could face a greater climb in gas prices in 2013 than it experienced last year.
Retail gasoline prices shot up 17 cents in a week to more than $3.50 a gallon on average — record-high prices for the beginning of February.
“However, these expenditures as a percentage of overall household income are still low when compared to the early 1980s,” according to EIA, “when the estimated portion of household income spent on gasoline surpassed 5%.”
Republicans have also jumped on rising gas prices as justification for immediately approving the Keystone XL pipeline.
“This country needs a comprehensive, ‘all-of-the-above’ energy plan that reduces our dependence on foreign oil,” said Florida Republican Rep. Vern Buchanan in a statement. “With gas prices threatening an already-struggling economy, it’s time to approve the Keystone pipeline and the thousands of jobs it will support.”