Historically high gas prices in the United States have led to consumer complaints, political consternation and even some changes in tax policy, but a look at prices paid in countries around the world reveals that things could be a lot worse.
The material for this post by Lorimer Wilson, Managing Editor of munKNEE.com, has been sourced from the original article by Elaine Silvestrini of kiplinger.com.
Below is the price per US gallon* in USD as of May 30, 2022 and global gasoline prices according to affordability i.e., the cost of filling a 40-liter tank (about 10.6 US gallons) as a percentage of monthly income. (*A US gallon is equivalent to 128 fluid ounces or 3.785 liters (American spelling) whereas there are 160 fluid ounces or 4.546 litres (British spelling) in an Imperial gallon or, to put it another way, there are 16.7% less fluid ounces in a US gallon compared to an Imperial gallon.
|Belgium||$8.10||2.4% (T 16)|
|Canada||$6.49||2.0% (T 11)|
|Germany||$8.80||2.4% (T 16)|
|Iceland||$9.47||2.0% (T 11)|
|Israel||$8.24||2.4% (T 16)|
|Saudi Arabia||$2.35||1.5% (2)|
|United Kingdom||$8.17||2.6% (20)|
|United States||$4.79||0.9% (1)|
The price/gallon as highlighted above is meaningless if the percentage of monthly income required to fill up at the pump is too high.
Several factors influence the differences between countries, mainly whether countries produce oil and the amount of taxes they charge. In the USA, for example, 54% of the price of gasoline goes toward paying for the oil, while 16% goes to taxes, 16% for distribution and marketing and 14% the cost of refining as illustrated in the infographic below:
Why Does the Russia-Ukraine Conflict Impact U.S. Gas Prices?
Only a fraction of America’s oil comes from Russia but the Russia-Ukraine conflict impacts prices in the U.S. because oil is bought and sold on a global commodities market so, when countries impose sanctions on Russian oil, that puts a squeeze on global supply, which ultimately drives up prices. This supply shock could keep prices high for a while unless the U.S. falls into a recession, which is a growing possibility based on how recent data is trending.