An Example of Media Puffery on Gas Prices

This kind of things just drives me batty.

This is from  An article in Time today:

Those labor protests reflect the hit millions of Europeans are taking at the gas pump. As American drivers groan over prices nearing $4 a gallon, the French are paying $8.67 for a gallon of super, compared to $7.10 in January, 2007. A gallon of diesel in French gas stations averages $8.54, up from $5.35 just a year ago. And in the U.K. diesel costs $11.50 per gallon, compared to around $3.90 in the U.S. Across the European Union, the average cost of a gallon of gas runs to about $8.70 — more than twice what Americans are shelling out to fill up. And Europe’s dizzying fuel costs would be even worse if it weren’t for the considerable appreciation of the euro and the British pound against the dollar over the past year, which has partially offset the price escalation in dollar-traded oil.

You see, articles like the above try to make our situation look better, by making ridiculous comparisons that simply cannot be made.

Five years ago, a Euro was worth about $1.10. Now, it’s worth about $1.60 and climbing. A British Pound Sterling was worth $1.60; now, it’s worth $2. And Europeans — and I know this sounds crazy — aren’t paid in dollars; they’re paid in Euros or Pounds Sterling. That’s not to say prices aren’t high over there, but they don’t pay for petrol with dollars. You see, it would cost US that much for a gallon of petrol if we traveled over there, if we got the best exchange rate possible.

The average price for a gallon of petrol in Britain is £5.12, according to this web site.  Three years ago, the average price of a gallon of petrol in Britain was £3.89. That’s a 32% increase.

The average price of a gallon of gas here is $3.94. Three years ago, the average price was $2.08.  That’s an 80% increase.

In other words, in REALITY, if we had seen the same relative increase in the price of gas as the Europeans, our price should be around $2.75 per gallon.

It’s simply a ridiculous comparison to compare gas prices in Europe and here, without taking into account the differences in currency. The British are being hit a lot less hard by gas prices than we are. That’s not to say 32% isn’t a sharp increase over 3 years. But wouldn’t $2.75 a gallon seem like a cheap price right about now?

Don’t buy this crap. This is one of those puff pieces to make you feel good about oil companies scamming you…