I am being hit hard by the cost of gasoline. Haven’t you written about how to save money on this in the past?
Shocked By Gasoline Prices
Dear Shocked By Gasoline Prices,
Yes, I have answered this question before but not during a time when prices were rising this sharply! You and millions of others are feeling the pinch at the pump along with all the other products impacted by the rising cost of oil.
Prepare to Pay More
Patrick DeHaan of GasBuddy says, “As Russia’s war on Ukraine continues to evolve and we head into a season where gas prices typically increase, Americans should expect to pay more for gas than they ever have before. Shopping and paying smart at the pump will be critical well into summer.” The chart below shows the trendline of gas prices from the last 18 months.
Here is a short list of things you can do to save some money:
Effect on Consumer Prices
The cost of crude oil affects the prices of everything we buy due to the impact on shipping and trucking. Expect to pay more for food at the grocery store, when dining out, on heating bills, and on things made with petroleum, like plastics and fertilizer. Those who need a bigger car should be on the lookout for used models that sellers will unload if gas prices get exorbitant
Keep It in Perspective
Crude oil prices fluctuate between extremes—often very quickly. Over the past 70 years, you can see in the chart below that these sharp spikes seldom last very long. Many believe that with the rise in purchases of electric vehicles, we will see a steady decrease in the price of oil. In the shorter term, a peaceful resolution to the war in Ukraine will hopefully reset the price—all the more reason to pray for peace.
Experts pose the possibility of this leading to a recession.
Troy Vincent, DTN senior market analyst, told CNET that if crude oil continues to rise, $6.50-$7.00 per gallon would not be impossible, though it could trigger a global recession.
Nicholas Colas, co-founder of DataTrek Research, covered the auto sector earlier in his career. He recently told msn.com: “The rule of thumb I learned from auto industry economics in the 1990s is that if oil prices go up 100% in a one-year period, expect a recession.” Thursday, March 4, 2021, crude oil was $63.81. Friday, March 4, 2022, WTI crude was $115. Monday, it touched $130 but dropped. In recent cycles, when oil gained 100% in a 1-year period, a recession occurred. This happens because consumers readjust their budgets so they can cut back, and spending declines. According to Kiplinger, the average length of recessions from 1857 forward is less than 17.5 months. This includes the 65-month recession of 1873 and the Great Depression, which lasted 43 months. (Check the website for more recession facts.)
Adjust Your Budget
Consider what you can give up to cover the higher cost of gasoline and consumer goods.
Turn down the thermostats, and dress in layers until temperatures rise this spring and summer.
Start a garden, grow some food, and shop at farmers’ markets. Supply an emergency long-term food pantry buying nonperishable food in bulk. Analyze vacation plans. Avoid extra airline fees when flying. Consider alternate means of transportation. It may be necessary to have a staycation or find a creative way to spend less while taking necessary time off.
Do Not Fear
When facing the lingering impact of the pandemic, a war, and inflation, there are many concerns right now. We can take comfort in God’s Word that reminds us that we have nothing to fear
Psalm 37:16 – “Better is the little that the righteous has than the abundance of many wicked.”
Psalm 112:7 – “He is not afraid of bad news; his heart is firm, trusting in the Lord.”
The Crown God is Faithful devotional provides inspiring and practical biblical wisdom. You can sign up to receive the devotionals daily to help transform not only your finances but also every area of your life.
This article was originally published on The Christian Post on March 11, 2022.
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