Drivers grumble about high gasoline prices all over the world. But with oil prices at record highs, many countries are saying goodbye to gas subsidies, making a trip to the filling station more expensive than ever.
Global gasoline prices vary enormously, thanks to widely divergent subsidy and taxation policies. Just look at what it costs to fill the 13.2-gallon tank of a 2007 Honda Civic around the world: It’s pocket change in Venezuela, but more than $30 in the United States. If you think that’s pricey, try driving in Turkey, where a full tank will set you back nearly $100.
Gasoline prices are based largely on the price of crude oil, but refining costs, distribution, and taxes also add to the tab. Some governments, such as Venezuela and Iran, pick up much of the bill through subsidies. But as the price of crude has risen, many countries have abandoned subsidies in favor of higher gas taxes. Indonesian motorists have perhaps been hit hardest: Gas prices there have increased a whopping 238 percent since 2000.
When two countries with vastly different pricing policies share a border, gasoline smuggling becomes a booming business. A Turkish driver can save $6.78 a gallon by filling up across the border in Iran. But if he doesn’t want to make the trip, there are plenty of smugglers willing to transport fuel for the right price.
Countries that keep prices artificially low do so at the peril of their budgets’ bottom line. Iran’s subsidies cut into its total state spending by nearly 40 percent. On the flip side, gasoline taxation can help curb state deficits. South Korea’s high fuel taxes bring in 15 percent of the country’s spending.
The United States consumes by far the most gasoline, a staggering 346 million gallons per day in 2003, the latest year for which data are available. By comparison, Japan and China, the next two biggest consumers, together use less than a quarter of that total.
Gasoline consumption by the United States vs. the 20 next largest gasoline consuming countries in millions of gallons per day
Foreign Policy
Global gasoline prices vary enormously, thanks to widely divergent subsidy and taxation policies. Just look at what it costs to fill the 13.2-gallon tank of a 2007 Honda Civic around the world: It’s pocket change in Venezuela, but more than $30 in the United States. If you think that’s pricey, try driving in Turkey, where a full tank will set you back nearly $100.
Gasoline prices are based largely on the price of crude oil, but refining costs, distribution, and taxes also add to the tab. Some governments, such as Venezuela and Iran, pick up much of the bill through subsidies. But as the price of crude has risen, many countries have abandoned subsidies in favor of higher gas taxes. Indonesian motorists have perhaps been hit hardest: Gas prices there have increased a whopping 238 percent since 2000.
Gasoline prices per gallon
When two countries with vastly different pricing policies share a border, gasoline smuggling becomes a booming business. A Turkish driver can save $6.78 a gallon by filling up across the border in Iran. But if he doesn’t want to make the trip, there are plenty of smugglers willing to transport fuel for the right price.
Countries that keep prices artificially low do so at the peril of their budgets’ bottom line. Iran’s subsidies cut into its total state spending by nearly 40 percent. On the flip side, gasoline taxation can help curb state deficits. South Korea’s high fuel taxes bring in 15 percent of the country’s spending.
The United States consumes by far the most gasoline, a staggering 346 million gallons per day in 2003, the latest year for which data are available. By comparison, Japan and China, the next two biggest consumers, together use less than a quarter of that total.
Gasoline consumption by the United States vs. the 20 next largest gasoline consuming countries in millions of gallons per day
Foreign Policy
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), and it takes me months to notice given how often I drive and have to refuel my '92 Nissan Sentra.
now that was a quality post. I take back whatever i said about you......
