Will lower gas taxes in Montana make the problem worse?
According to chief oil analyst for Gas Buddy, Patrick DeHaan, the only control Missoula consumers will have over gas prices for the foreseeable future is simply to conserve gas by driving fewer miles.
KGVO reached out to DeHaan on Monday for an update on soaring oil and therefore gas prices in Missoula.
“Average gasoline prices in Montana increased by about nine cents per gallon last week, with the statewide average now at $4.09 per gallon,” DeHaan began. “This is the first time we hit that $4.00 per gallon mark in quite some time. Last week’s national average prices actually slipped about a penny a gallon. Much of the West Coast, however, is experiencing tensions led by California refineries having a few issues here and there, tight gasoline supplies in the Rocky Mountains as refiners begin to switch to summer gasoline more expensive and the volatility of oil prices is certainly not helping either.
DeHaan said diesel prices are much higher than regular gasoline, and most of our food and other consumer products arrive by diesel-powered trucks.
“Diesel prices have already eclipsed that mark (by $5.00 a gallon), in fact, Missoula at $4.99 or $5.02 for diesel is what we’re seeing across the country” , did he declare. “The average diesel price is now $5.11 per gallon. Much of this is due to the continuing imbalance in diesel, or what we call distillates, is that there has been far more demand than there is supply, which has drives diesel prices to record highs.
DeHaan was asked about suggestions that the U.S. government and states would temporarily lower or eliminate federal and state gasoline taxes to reduce the price of gasoline for consumers. He said that would be a very bad idea.
“It could increase gas mileage by reducing the price and it can make the problem worse,” he said. “If people don’t have to pay so much for gas, they’re unlikely to make behavioral changes to reduce their consumption. So when you see a state granting a “gas tax” or issuing gas cards to offset the price hike, it could make the problem worse in the future as Americans refrain from bringing behavioral changes that will reduce their consumption.
DeHaan said that despite America’s complete reliance on its cars and trucks, reducing demand is the only way to save money on gasoline.
“If motorists really wanted to take reducing prices seriously and help bring them down, then we could really take steps to reduce our consumption by driving more fuel efficiently by combining journeys, and all kinds of behavior essentially, to conserve and reduce our gas mileage,” he said. “It’s really the only way to get out of this is when Americans start cutting their mileage.”
On Friday, Los Angeles became the first major city in the United States to reach an average gas price of $6.00 or more. In Missoula, the price of regular unleaded averages $4.09 per gallon.
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