6 ms·

Sure, but is it a bad thing altogether?

by zwirbl 5y ago

missedthecue 5y ago
Higher gas prices incentivize more exploration. Though this shutoff will only be temporary while the storm passes.
- mxschumacher 5y ago
  They also incentivize different consumption patterns, such as owning a more fuel efficient car, flying less or installing better isolation in a home. Looking at the chart of US Prius sales the last time oil prices went up a lot is really telling
  - Teknoman117 5y ago
    The problem there is that you can’t really save money upgrading to a more fuel efficient car. If you fully own a car (paid off, etc.) there’s not exactly many situations where your new car payment is less than the difference in fuel price. Even if you buy it completely, the break even point is long past the average time an American typically owns any given car. For instance: I drive an 18 year old Ford Expedition (2004). It gets 20 miles per gallon highway if I respect the speed limit and 12 city. My average per tank is about 15 mpg. It’s been paid off for more than a decade. It’s still in good shape will probably last another last another 100k miles before the engine dies. Let’s take a 3 year old used Prius for comparison. Most of my friends who have them tell me their average fuel economy is anywhere from 35 to 40 mpg. You can get a 2018 full size for ~$27k. How far do you have to drive before going from 15 mpg to 40 mpg saves you $27k? If we use the price from the gas station down the street, which is charging $4.40 per gallon for 87 octane, you’d have to drive (27000 / 4.4) * (40 - 15) = 153,409 miles before you broke even. Most cars don’t get to that age before getting destroyed one way or another. If you’re bored of your car, sure, get one that’s better for the environment. But it has not and will not (at least for awhile) make sense (financially) to buy a new car purely based on fuel economy. Edit - for the non-Americans, mpg = miles per gallon, which is our customary unit for fuel efficiency. The larger the number the better. The conversion to L/100km would be 235.214583 / mpg.
    - ulrikrasmussen 5y ago
      But the money you spend on a car is not gone as with gas, since the car still has sales value. Isn't a more accurate comparison to compare average gas price per mile + average depreciation per mile?
      - Teknoman117 5y ago
        The "value" falls off quickly and dramatically though. Unless you have a desirable car that is well known to be just as good used as new (examples: Tesla, Jeep Wrangler, etc.), the second owner isn’t likely to get much of anything for it. If they bought it used at 3 years old, they probably paid 80% of the price it was new, and the dealer probably paid the original owner 60% of what it was worth new. If they hang onto it long enough to pay off a standard length auto loan (5 years) and drive it for a bit after that, you’re probably looking at a ten year old vehicle. They aren’t worth much to trade in. The dealer will pay you 5% of what it was worth new. At 20 years, be happy that they’re willing to dispose of your car for free. I’d be lucky to get a dealer to give me $2k for my ‘04 expedition, but they’d only give me $5k if it was a ‘12 with half the mileage. That all being said, most cars in the US aren’t replaced because they’re not working or serviceable. People get bored of driving the same car every day. Either that, or they don’t trust a car after an accident, or the insurance company declares your car totaled because they think they can make a profit by fixing it a bit and selling it in a country with less stringent safety requirements. I still drive my SUV because I’m a 6’4 dude who has a lot of trouble finding a comfortable vehicle. Most crossovers have my knees jammed into the dash or the entertainment system.
        southerntofu 5y ago
        > examples: Tesla I am curious how electric car batteries will fare in the long run. Lithium batteries in the computing world (eg. smartphone batteries) are well known to lose charge after a few years. Considering battery is a considerable cost in manufacture/maintenance of an electric car, i'm not sure how that would play out. I guess we'll have to wait another decade to find out whether that's a disaster or not.
- Emma_Goldman 5y ago
  Not in the Gulf of Mexico if the reason for the spike is the increasing frequency of major hurricanes and tropical storms. Last year, hurricanes Zeta, Delta, Sally, and Laura all disrupted offshore oil production in the Gulf. Though I don't think these claims should be taken too seriously, investors increasingly claim to price the 'physical risks' of climate change into their portfolios.
decremental 5y ago
It's probably bad if you're living paycheck to paycheck and you're struggling to get by. Then on top of already extremely high gas prices they increase further. On top of prices for everything else going up and the value of the dollar going down. Sure, it's probably a bad thing altogether.
- MisterBastahrd 5y ago
  Gas prices are comically low in the US compared to other countries.
  - LurkingPenguin 5y ago
    But Americans drive substantially more miles each year than people in other countries do. https://policyadvice.net/insurance/insights/how-much-do-americans-drive/ https://policyadvice.net/insurance/insights/how-much-do-amer...
    - southerntofu 5y ago
      Note that this is not just due to geography but to actual urban planning/architecture. Post-WWII US cities were explicitly designed for cars, and that's a disaster ecologically and practically. See also Ivan Illich's Tools for Conviviality which has a long analysis on why car-oriented cities has a terribly-low efficiency.
      - imtringued 5y ago
        It's a disaster financially. Especially in california with prop 13 people don't pay enough property taxes to maintain the suburban infrastructure in front of their houses.
    - halfdan 5y ago
      In cars that burn substantially more fuel per mile than cars in other countries..
  - 5y ago

Sure, but is it a bad thing altogether?

by zwirbl 5y ago

Sure, but is it a bad thing altogether?

missedthecue 5y ago

Higher gas prices incentivize more exploration. Though this shutoff will only be temporary while the storm passes.

mxschumacher 5y ago
They also incentivize different consumption patterns, such as owning a more fuel efficient car, flying less or installing better isolation in a home. Looking at the chart of US Prius sales the last time oil prices went up a lot is really telling
- Teknoman117 5y ago
  The problem there is that you can’t really save money upgrading to a more fuel efficient car. If you fully own a car (paid off, etc.) there’s not exactly many situations where your new car payment is less than the difference in fuel price. Even if you buy it completely, the break even point is long past the average time an American typically owns any given car. For instance: I drive an 18 year old Ford Expedition (2004). It gets 20 miles per gallon highway if I respect the speed limit and 12 city. My average per tank is about 15 mpg. It’s been paid off for more than a decade. It’s still in good shape will probably last another last another 100k miles before the engine dies. Let’s take a 3 year old used Prius for comparison. Most of my friends who have them tell me their average fuel economy is anywhere from 35 to 40 mpg. You can get a 2018 full size for ~$27k. How far do you have to drive before going from 15 mpg to 40 mpg saves you $27k? If we use the price from the gas station down the street, which is charging $4.40 per gallon for 87 octane, you’d have to drive (27000 / 4.4) * (40 - 15) = 153,409 miles before you broke even. Most cars don’t get to that age before getting destroyed one way or another. If you’re bored of your car, sure, get one that’s better for the environment. But it has not and will not (at least for awhile) make sense (financially) to buy a new car purely based on fuel economy. Edit - for the non-Americans, mpg = miles per gallon, which is our customary unit for fuel efficiency. The larger the number the better. The conversion to L/100km would be 235.214583 / mpg.
  - ulrikrasmussen 5y ago
    But the money you spend on a car is not gone as with gas, since the car still has sales value. Isn't a more accurate comparison to compare average gas price per mile + average depreciation per mile?
    - Teknoman117 5y ago
      The "value" falls off quickly and dramatically though. Unless you have a desirable car that is well known to be just as good used as new (examples: Tesla, Jeep Wrangler, etc.), the second owner isn’t likely to get much of anything for it. If they bought it used at 3 years old, they probably paid 80% of the price it was new, and the dealer probably paid the original owner 60% of what it was worth new. If they hang onto it long enough to pay off a standard length auto loan (5 years) and drive it for a bit after that, you’re probably looking at a ten year old vehicle. They aren’t worth much to trade in. The dealer will pay you 5% of what it was worth new. At 20 years, be happy that they’re willing to dispose of your car for free. I’d be lucky to get a dealer to give me $2k for my ‘04 expedition, but they’d only give me $5k if it was a ‘12 with half the mileage. That all being said, most cars in the US aren’t replaced because they’re not working or serviceable. People get bored of driving the same car every day. Either that, or they don’t trust a car after an accident, or the insurance company declares your car totaled because they think they can make a profit by fixing it a bit and selling it in a country with less stringent safety requirements. I still drive my SUV because I’m a 6’4 dude who has a lot of trouble finding a comfortable vehicle. Most crossovers have my knees jammed into the dash or the entertainment system.
      - southerntofu 5y ago
        > examples: Tesla I am curious how electric car batteries will fare in the long run. Lithium batteries in the computing world (eg. smartphone batteries) are well known to lose charge after a few years. Considering battery is a considerable cost in manufacture/maintenance of an electric car, i'm not sure how that would play out. I guess we'll have to wait another decade to find out whether that's a disaster or not.
Emma_Goldman 5y ago
Not in the Gulf of Mexico if the reason for the spike is the increasing frequency of major hurricanes and tropical storms. Last year, hurricanes Zeta, Delta, Sally, and Laura all disrupted offshore oil production in the Gulf. Though I don't think these claims should be taken too seriously, investors increasingly claim to price the 'physical risks' of climate change into their portfolios.

decremental 5y ago

It's probably bad if you're living paycheck to paycheck and you're struggling to get by. Then on top of already extremely high gas prices they increase further. On top of prices for everything else going up and the value of the dollar going down. Sure, it's probably a bad thing altogether.

MisterBastahrd 5y ago
Gas prices are comically low in the US compared to other countries.
- LurkingPenguin 5y ago
  But Americans drive substantially more miles each year than people in other countries do. https://policyadvice.net/insurance/insights/how-much-do-americans-drive/ https://policyadvice.net/insurance/insights/how-much-do-amer...
  - southerntofu 5y ago
    Note that this is not just due to geography but to actual urban planning/architecture. Post-WWII US cities were explicitly designed for cars, and that's a disaster ecologically and practically. See also Ivan Illich's Tools for Conviviality which has a long analysis on why car-oriented cities has a terribly-low efficiency.
    - imtringued 5y ago
      It's a disaster financially. Especially in california with prop 13 people don't pay enough property taxes to maintain the suburban infrastructure in front of their houses.
  - halfdan 5y ago
    In cars that burn substantially more fuel per mile than cars in other countries..
- 5y ago