Turns out, prices don't really affect gasoline demand
 

Filed under: Green Culture, MPG, United States

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We've been hearing for a while that the steady drop in US fuel prices are hurting sales of fuel-efficient cars like hybrids and plug-ins. As far as driving habits, though? Lower prices are the pump are having little impact on how much people are behind the wheel, according to the US Energy Information Administration (EIA).

In short, gas prices are down more than a dollar from their 2014 peak of about $3.70 a gallon in June. But gas prices would have to fall as much as 50 percent in order to boost automobile travel by as much as one percent, according to the EIA.

That wasn't always the case. Two decades ago, a 12-percent drop in gas prices would push up automobile travel by a percentage point. The difference, the EIA says, is that people could be more set in their ways now when it comes to driving habits. Additionally, vehicle-miles-per-capita driven has fallen as urban sprawl has slowed and many city dwellers have opted for public transportation or biking.

This could all be a good thing. If gas prices fall further, it doesn't necessarily follow that people will be ditching their bikes or train route for their cars. On the flipside, though, more people may opt for gas-guzzlers and fewer may choose high-MPG vehicles. And we're not the first to think up this theory. National Public Radio in October surmised that dropping gas prices were crimping sales of the Toyota Prius and other hybrid models sold in the US. Check out the EIA's press release below.Continue reading Turns out, prices don't really affect gasoline demand

Turns out, prices don't really affect gasoline demand originally appeared on AutoblogGreen on Wed, 17 Dec 2014 08:02:00 EST. Please see our terms for use of feeds.



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