While driving with a friend yesterday, we passed a number of service stations that were selling regular gasoline for less than $2.00 per gallon. Some were advertising regular at $1.85 and Costco’s price was $1.79. My last discussion on this topic, Retail Gasoline Price Check for the Start of the 2015 Holiday Season, was published on November 14, 2015 – about two weeks before Thanksgiving. The national average for a gallon of gasoline on that day was $2.167.
I’ve been waiting for regular gasoline to drop below $2 per gallon. Today’s U.S. average price is $2.027 and Arizona’s average is $2.002. However, in metro-Phoenix it is $1.977 and good enough for me. (Source: GasBuddy.com)
What furrowed my brows today was a post in Oil Pro’s newsletter that noted that the cost of a gallon of crude oil is less than the same amount of distilled water. Mike Rasco, oil and gas consultant, provides the comparison and shows that the current price of a barrel of crude was trading earlier today at $39.22. With 42 gallons per barrel, this comes to $0.934 per gallon.
You might find distilled water at Wal-Mart for about $0.90, however, you probably won’t leave the Dollar Store paying less than $0.99. Other places sell it for $1.19 or more per gallon.
Rasco creatively shows how today’s cost of one gallon of gasoline compares with a gallon of other items (Note: Most of these items are not usually sold in gallon quantities.):
- Hydrogen Peroxide – $10.32
- Ketchup – $8.00
- Domestic Beer – $5.33
- Low Fat Milk – $3.79
- Soy Sauce – $15.33
- Black Printer Ink – $2,560
- Insulin – $9,411
- Chanel No 5. Perfume – $25,650
- Scorpion Venom – $38,858,507
After reviewing the above price list, I consider the current cost of gasoline in the U.S. a grand bargain. U.S. motorists are getting an early Christmas present with extra dollars to spend on other items this December. Although Rasco does not say what type of crude oil he uses for his analysis, Bloomberg reported that West Texas Intermediate (WTI) closed at a price of $37.86 per barrel.
Happy holidays and happy motoring.
- By The Gallon, Oil Now Costs Less Than Distilled Water, by Mike Rasco in Oil Pro, December 7, 2015, http://oilpro.com/post/20673/gallon-perspective