COLOGNE, Germany (AP) – At a gas station near Cologne Airport, Germany, Bernd Mueller watches the numbers rise rapidly to the pump: 22 euros ($ 23), 23 euros, 24 euros. Figures showing how much gasoline it receives are also rising. But much slower. Painfully slow.
“I’m getting out of my car this October, November,” said Mueller, 80. “I retired, and then there’s gas and all that.” At some point, you have to reduce the scale. ”
All over the world, drivers like Mueller are rethinking their habits and personal finances amid soaring gasoline and diesel prices fueled by Russia’s war in Ukraine and the global recovery from the COVID-19 pandemic. Energy prices are a key driver of rising global inflation and rising living costs.
A taxi driver in Vietnam turns off his driving app instead of burning valuable fuel during rush hour backups. A French family is reducing its ambitions for the August holidays. A graphic designer from California includes the price of gas in the bill for one night. A mother in Rome, calculating the cost of driving her son to camp, mentally crossed out the evening for pizza.
Solutions in the global economy are as diverse as consumers and countries themselves: Walk more. Clean the dust from this bike. Take the subway, train or bus. Use a light touch on the accelerator pedal to save fuel. Take a look at this trip – is it worth it? Or maybe even run out of a car.
For the countless millions who do not have access to adequate public transport or otherwise cannot give up their car, the solution is to grit their teeth and pay, while reducing costs elsewhere.
Nguyen Trong Tuyen, a motorcycle taxi driver working for the Grab online service in Hanoi, Vietnam, said he simply turned off the app at rush hour.
“If I get stuck in a traffic jam, the travel tax will not cover the cost of petrol for the trip,” he said.
Many drivers stop their services like Tuyen, which makes it difficult for customers to book trips.
In Manila, Ronald Sibii burned diesel worth 900 pesos ($ 16.83) a day to drive his jeep, a colorfully decorated vehicle popular for public transportation in the Philippines that evolved from American military jeeps left behind after World War II. Now that’s a total of 2,200 pesos ($ 41.40).
“It simply came to our notice then. “Now there is nothing or anything left,” he said. His income has fallen by about 40% due to higher fuel prices.
Gasoline and diesel prices are a complex equation of the price of crude oil, taxes, purchasing power and wealth of individual countries, government subsidies where they exist, and reductions taken by intermediaries such as refineries. The price of oil is in dollars, so if a country is an importer of energy, the exchange rate plays a role – the recent weaker euro has helped raise gasoline prices in Europe.
And there are often geopolitical factors, such as the war in Ukraine. Buyers avoiding Russian barrels and Western plans to ban oil in the country have rocked energy markets, which are already facing limited supplies from the rapid recovery of the pandemic.
There is a global price for oil – about $ 110 a barrel – but there is no global price for the pump due to taxes and other factors. In Hong Kong and Norway, you can pay more than $ 10 per gallon. In Germany it can be around $ 7.50 per gallon, and in France around $ 8. While lower fuel taxes mean that the average gallon for the United States is slightly cheaper at $ 5, this is still the first time the price has been so high.
People in poorer countries are quick to feel the stress of higher energy prices, but Europeans and Americans are also under pressure. Americans have less access to public transport, and even European transit networks do not reach everyone, especially those in the countryside.
Charles Dupont, manager of a clothing store in the Essonne region, south of Paris, just has to use his car to travel to work.
“I practice eco-driving, which means driving slower and avoiding sudden stops,” he said.
Others do what they can to reduce it. Leticia Cecinelli, refueling at a gas station in Rome, said she was riding a bicycle and trying to reduce car travel “where possible”.
“But if I have a child and I have to take him to camp?” “I have to do it by cutting extra pizza,” she said.
Pump prices can be political dynamite. US President Joe Biden has urged Saudi Arabia to pump more oil to help reduce gas prices by deciding to travel to the kingdom next month after Saudi Arabia-led OPEC + decided to increase production. The United States and other countries have also released oil from their strategic reserves, which helps, but is not crucial.
Several countries have ceilings on fuel prices, including Hungary, where the discount does not apply to foreign registration numbers. In Germany, the government cut taxes by 35 cents per liter for petrol and 17 cents for diesel, but prices soon began to rise again.
Germany has also introduced a 9-euro monthly discount on public transport, leading to crowded stations and trains over the recent holiday weekend. But the program lasts only three months and is of little use to people in the countryside if there is no train station nearby.
In fact, people are pumping just as much gas as before the pandemic, according to the German Gas Station Association.
“People fill up just as much as before – they grumble, but they accept it,” said group spokeswoman Herbert Rable.
Is there any relief? Much depends on how the war in Ukraine affects world oil markets. Analysts say some of Russia’s oil is almost certain to be lost to markets, as the European Union, Russia’s largest and closest customer, has promised to suspend most purchases from Moscow within six months.
Meanwhile, India and China are buying more Russian oil. Europe will have to get its supplies from elsewhere, such as exporters from the Middle East. But OPEC +, which includes Russia, has failed to meet its production targets.
For many, spending on things like night outs and in Europe, almost religious devotion to long late summer vacations is on the cutting table.
Isabel Bruno, a teacher in the suburbs of Paris, now takes the bus to the station instead of driving for 10 minutes.
“My husband and I are really worried about the holidays because we drove our car very often while visiting our family in the South of France,” she said. “Now we will pay attention to train tickets and use our car only for short trips.”
Leo Teus, a graphic designer from the city of Hayward in the San Francisco Bay Area, has to be “strategic” in gas budgeting while going out to meet with customers – he may not fill the tank completely. California gas prices are the highest in the United States, reaching nearly $ 7 a gallon in parts of the state.
When it comes to going to a club or bar after work, “you have to think about gas now, you have to decide if it’s really worth going there or not?” Theus said.
___
Corona reports from Rome, Le Deley from Paris and Dinh from Hanoi, Vietnam. AP reporters Joal Calupitan of Manila, Philippines, and Terry Chea of Oakland, California, contributed.
Add Comment