Supply, demand, and consumer gasoline prices
October 08, 2003
According to the BLS Consumer Expenditure Survey, the average consumer spent approximately $1,300 on gasoline and motor oil in 2000, an increase of 22.4 percent over the 1999 figure.
Over the same period, the average price of gasoline increased 36.3 percent, indicating that price changes within the gasoline market can substantially affect consumers’ spending.
Conventional reasoning suggests that the high level of volatility for gasoline prices is the result of supply forces, as the price of crude petroleum changes rapidly due to production decisions of the Organization of Petroleum Exporting Countries (OPEC) nations. However, shifts in demand also can cause variations in gasoline prices.
Historically, price changes for consumer gasoline have been driven by changes in supply as opposed to demand. In all recent cases, interruptions in the supply of crude petroleum resulted in significant increases in the prices of crude petroleum, wholesale gasoline, and consumer gasoline. However, changes in demand affected gasoline prices only marginally.
The data in the chart are from the Consumer Expenditure Survey program; these and other data are analyzed in "Consumer gasoline prices: an empirical investigation," Monthly Labor Review, July 2003.
Bureau of Labor Statistics, U.S. Department of Labor, The Economics Daily, Supply, demand, and consumer gasoline prices on the Internet at http://www.bls.gov/opub/ted/2003/oct/wk1/art03.htm (visited September 30, 2014).
Three recent editions of Spotlight on Statistics
Housing: before, during, and after the Great Recession
looks at consumer expenditures on household items, employment in residential construction, prices for household items, and injuries in occupations involved in building and maintaining our homes.
Women veterans in the labor force examines the demographic, employment, and unemployment characteristics of women veterans.
BLS Statistics by Occupation provides an overview of occupational employment and wages with an emphasis on STEM jobs and occupational data by typical entry-level education required.