
Today, the average price of gas in the USA is $3.29 per gallon. It sounds expensive, but it’s actually quite cheap compared to prices in the rest of the world. In Japan and Korea, gas costs around $5.50 per gallon. In Hong Kong, Germany, and Denmark, gas can cost as much as $7.50 per gallon. Filling up a 16-gallon tank in a mid-sized car can easily cost over $110 in Norway. To put that in perspective, $110 can pay for two weeks worth of groceries.
At $3.29/gallon, you could be spending $2000 each year in gas prices alone if you commute 30 miles each day to work (1). If two people commute separately, that’s $4000 each year. And there’s more awful news to come: the price of oil will only continue to increase. It’s a matter of basic economics: demand is increasing, but supply is running out.
Petroleum is a limited, non-renewable resource. This means that oil production follows a curve: it starts slow, hits a peak, and then begins to trail. Oil engineers predicted this phenomenon in the early 1950s—and this may be the decade we may finally reach peak oil. Soon thereafter, global oil production will taper off. Already, most easy-to-reach oil supplies have been exhausted. Oil companies are now increasingly resorting to offshore and tar sands oil extraction, which are both expensive and harmful to the environment. Yet while supply is decreasing, demand for oil is exploding. In particular, the burgeoning middle classes of China and India are acquiring a taste for motor vehicles. With a billion cars worldwide today, and tens of millions more added each year, the price of fuel will skyrocket.

Oil production peak by country. (from US Department of Energy)
Our current era of cheap, unlimited energy is quickly coming to an end. By the end of this decade, the average household could be spending $8000+ on gasoline each year just to commute to work. Our society’s driving habits will change—if not for environmental reasons, then at least because of the price.
The best strategy for dealing with the upcoming energy crisis is to wean yourself off of petroleum. Live with less gasoline so that rising fuel prices won’t affect your standard of living. Not only will you help reduce pollution, you’ll be saving thousands of dollars, too.
Switch over to mass transit whenever you can. They conserve fuel and ultimately conserve you money. A $65 monthly bus pass could save you $100 each month in fuel costs alone, or $1200 each year (2). If you can live without a car, you can save another $4000 each year in auto insurance, car payments, and parking fees. You’ll also save time; instead of fighting traffic, you can read, rest, or relax.
If you’re willing to totally unplug from the oil economy, you can start bicycle commuting . By cycling, you can save $6000+ each year. You don’t even need a specialized bicycle; just use what you have. In fact, if you live close enough, you can just walk. Both tactics will save you money while providing exercise.
For decades, we’ve been willfully ignorant about the fact that oil is a limited resource. We pretended that gas pumps had a supply that could never end. But within a decade, many of us may be forced to live car-free out of economic necessity. We didn’t pay attention to conservation in the past; but today, we can’t afford not to.
- Assumptions: $3.29/gallon, 30 miles 1-way implies 60 miles round-trip, 5 days per week, 50 weeks per year, average mileage is 25 miles/gallon: $3.29/gallon × 30 miles × 2 (round-trip) × 5 days/wk × 50 wks/yr ÷ 25 miles/gallon = $1974/yr. Per month, it’s $1974÷12 = $164.5. For two commuters, it’s $1974 &multiply; 2 = $3948/yr. If gas rises to $6.59/gallon (doubling in price), the cost of fuel for two commuters is $7896/yr.
- A Los Angeles monthly bus pass is $75, and Orange County’s is $55. If the average bus pass is $65/mo., the difference between gasoline price and bus fare is $164.5 – $65 = $99.5. If we roughly estimate the cost of auto insurance ($1550), parking ($500), and car payments ($200/mo. &multiply 12mo. = $2400), the additional cost of car ownership is $4450/yr., not including the cost of maintenance and vehicle registration fees.

