Gasoline Price Changes - Federal Trade Commission

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GASOLINE PRICE CHANGES: Price (Cents per Gallon Excluding Taxes) 250 200 150 100 50 0 1978 1979 Source: EIA, BEA Figure 3-2: U.S. Annual Average Nominal and Real Gasoline Prices, Excluding Taxes (1978-2004) Nominal Price Real Price (2004 Dollars) 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 In 2004, the national annual average retail price per gallon of gasoline rose sharply to $1.44. Adjusted for inflation, this is the highest national annual average retail price per gallon since 1984. Nonetheless, the 2004 national annual average retail price per gallon of $1.44 remains well below the 1981 high of $2.10 per gallon, as well as the annual averages of $1.83 and $1.58 per gallon in 1982 and 1983. In sum, Figure 3-2 shows that the annual average retail price for regular gasoline in the U.S. – adjusted for inflation and excluding taxes – did not rise above $1.20 per gallon between 1986 and 2003. Relative to earlier periods, these average prices, in general, were surprisingly low. B. Real and Nominal Annual Average Retail Gasoline Prices in the U.S., Including Taxes, from 1978 to 2004. Adding state and local taxes to the data confirms the observation above that state and local gasoline taxes can add a significant amount. For example, from 1991 to 2004, at the national level, taxes averaged 30 percent of the total retail price. For 2004, the real annual retail price per gallon of gasoline excluding taxes was $1.44, but if taxes are included, the price was $1.85. This is still just about $1.00 below the 1981 national annual average retail price per gallon – including taxes – of $2.94, however. See Figure 3-3, showing Monthly Regular Gasoline Prices, Nominal and Real. Figure 3-3 uses monthly data rather than annual data to 44 FEDERAL TRADE COMMISSION, JUNE 2005
THE DYNAMIC OF SUPPLY, DEMAND, AND COMPETITION illustrate the greater variability in real and nominal prices depending upon which averages are used. Both annual and monthly data are useful, and they help illustrate slightly different perspectives on the same data. Price (Cents per Gallon) 350 300 250 200 150 100 50 0 Jan-80 Jan-81 Source: EIA, BEA Figure 3-3: U.S. Monthly Average Nominal and Real Retail Regular Gasoline Prices (1980-2004) Jan-82 Jan-83 Jan-84 Real Price (2005 Dollars) Jan-85 Jan-86 Jan-87 Jan-88 Jan-89 Jan-90 Jan-91 Jan-92 Nominal Price C. Real and Nominal Annual Average Gasoline Prices in the U.S., Including Taxes, from 1919 to 2004. Looking further back in time reveals the U.S. annual average retail gasoline prices in the 1990s as low relative to prices in earlier decades. Figure 3-4 shows real U.S. average annual retail gasoline prices – once again, including taxes – from 1919 through 2004. In real terms – that is, in terms of the price of a gallon of gasoline in relation to the value of a dollar – the data show gasoline prices from 1986 through 2003 were at their lowest levels since 1919. From 1919 until around 1960, real U.S. annual average retail gasoline prices were above $2.00 per gallon. Between 1960 and 1978, real U.S. annual average retail gasoline prices were between $1.65 and $2.10 per gallon. The price spikes of the early 1980s, however, drove annual average prices to almost $3.00 per gallon. CHAPTER 3: THE NATIONAL LEVEL 45 Jan-93 Jan-94 Jan-95 Jan-96 Jan-97 Jan-98 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04
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Federal Trade Commission DEBORAH PL
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GASOLINE PRICE CHANGES: The vast ma
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GASOLINE PRICE CHANGES: $ The World
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GASOLINE PRICE CHANGES: expect incr
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GASOLINE PRICE CHANGES: Figure 3-6:
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GASOLINE PRICE CHANGES: $ Increased
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GASOLINE PRICE CHANGES: $ Since 199
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GASOLINE PRICE CHANGES: increase lo
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GASOLINE PRICE CHANGES: England and
Page 21 and 22: Table of Contents EXECUTIVE SUMMARY
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Page 35 and 36: Price (Cents per Gallon) 220 200 18
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Page 55 and 56: Million Barrels per Day 0.9 0.8 0.7
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THE DYNAMIC OF SUPPLY, DEMAND, AND
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CHAPTER 5. STATE AND LOCAL POLICIES
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Percentage of Customers Lost to 1%
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Retail Price (cents per gallon) 220
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Share (Percent) 80 70 60 50 40 30 2
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Price (Cents per Gallon) 200 190 18
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6. GAO, supra note 5, at 20. 7. Id.
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Herfindahl-Hirschman Index (HHI) Th
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