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Monday, June 27, 2022

Prices are skyrocketing at gas stations around the world

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COLOGNE, Germany (AP) — At a gas station near the airport in Cologne, Germany, Bernd Mueller watches the numbers quickly add up at the pump: 22 euros ($23), 23 euros, 24 euros. The numbers that indicate how much gas you put in also increase, but much, much more slowly.

“I get rid of my car in October, November,” said Mueller, 80. “I’m retired and there’s fuel and all that. At some point, you have to cut.

Around 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 rebound from the shutdown. COVID-19 pandemic. Energy prices are a key driver of inflation, which is rising worldwide and making the cost of living more expensive.

A motorbike taxi driver in Vietnam disables his app to receive warnings from customers so they don’t consume precious fuel in rush-hour traffic jams. A French family cut their holiday plans in August. A graphic designer in California includes fuel in his estimate for a party. A mother in Rome is removing pizza night from her calendar after seeing how much it would cost to take her son camping.

Decisions around the world are as varied as consumers and countries: walk more, dust off your bike, take the metro, train or bus. Drive slower to save fuel or review this road trip. Maybe even do without the car.

For the millions of people who don’t have access to adequate public transport or can’t live without their car for other reasons, the solution is to quit and pay while they cut spending elsewhere.

Nguyen Trong Tuyen, a motorbike taxi driver for ride-sharing app Grab in Hanoi, Vietnam, simply turns off the app during rush hour.

“If I’m stuck in traffic, the fee won’t cover the cost of gas for the trip,” he said.

Many drivers are interrupting their services like Tuyen, making it harder for customers to book rides.

In Manila, Ronald Sibeyee spent $900 ($16.83) worth of diesel a day on his jeepney, a brightly decorated vehicle popular as public transport in the country, an evolution of American military jeeps left over from World War II. Now they are 2,200 pesos ($41.40).

“That should have been our income now. Now there is nothing, or what is left,” he said. Their income has dropped by around 40% due to rising fuel prices.

Gasoline and diesel prices are the result of a complex equation about the cost of crude oil, taxes, the purchasing power and wealth of each country, government subsidies where they exist and the commission that take intermediaries such as refineries. The price is calculated in dollars, so if a country is an energy importer, the exchange rate is also a factor, as in Europe, where a weaker euro has helped to drive up prices.

There are also often geopolitical factors, such as the war in Ukraine. Buyers rejecting Russian barrels and Western plans to ban Russian crude rattled energy markets already struggling with supply issues due to the rapid rebound from pandemic shutdowns.

There is a world price for crude oil, about $110 a barrel, but there is no world price at gas stations because of taxes and other factors. In Hong Kong and Norway, you can pay upwards of $10 per gallon (3.79 liters). In Germany it can be around $7.50 per gallon and in France around $8. Although lower fuel taxes make the US average a bit lower, at around $5 a gallon, it’s never been higher.

People in poor countries quickly feel the pressure of energy prices, but Europeans and Americans are also feeling the effects. Americans have less access to public transport, and even European networks do not go everywhere, especially in rural areas.

Charles Dupont, who runs a clothing store in Essonne, south of Paris, just needs his car to get to work.

“I practice eco-driving, that is to say driving more slowly and avoiding sudden braking,” he explains.

Others do what they can to reduce their consumption. Letizia Cecinelli, who was refueling at a petrol station in Rome, said she commutes by bicycle and has tried to reduce car journeys “as much as possible”.

“But what if I have a son and I have to take him to camp? I have to do it by cutting an extra pizza,” he said.

Gas station prices can be political dynamite. US President Joe Biden has pushed Saudi Arabia to pump more oil to help bring down prices, announcing a trip to the kingdom next month after Riyadh’s OPEC alliance decided to increase production. The United States and other countries have also released oil from their strategic reserves, which helps but is not decisive.

Several countries have price limits. This is the case in Hungary, where the reduction is not applied to cars with foreign license plates. In Germany, the government reduced taxes by 35 cents per liter for gasoline and 17 cents for diesel, but prices soon rose again.

Germany has also introduced a €9 discounted monthly ticket for public transport, which packed stations and trains over a recent holiday weekend. But the program lasts only three months and does not help people in rural areas much if there is no train station nearby.

In fact, people are using almost the same amount of gasoline as before the pandemic, according to the German petrol station association.

“People are filling up almost as much as before. They protest, but they accept it,” said group spokesman Herbert Rabl.

Is there relief in sight? It all depends on the impact of the war in Ukraine on world oil markets. Analysts say some Russian crude is almost certain to be lost to the market as the European Union, Russia’s biggest and closest customer, has promised to end most crude oil purchases. Moscow within six months.

Meanwhile, India and China are buying more Russian oil. Europe will have to source its supplies elsewhere, like exporters in the Middle East. But OPEC, which includes Russia, is not meeting its production targets.

For many, spending money on things like a night out and, in Europe, the quasi-religious devotion of long summer holidays are at stake.

Isabelle Bruno, a teacher in the Paris suburbs, now takes the bus to the station instead of driving 10 minutes.

“My husband and I are very worried about the holidays, because we used to take the car very often when we visited our family in the south of France,” she said. “Now we will be careful with train tickets and only use the car for short trips.”

Leo Theus, a graphic designer in the Bay Area town of Hayward, has to be “strategic” about budgeting for fuel when meeting with clients, and he doesn’t fill the entire tank, for example. Gas prices in California are the highest in the United States, approaching $7 per gallon in some parts of the state.

When it comes to going to a club or a bar after work, he says, “now you have to think about fuel, you have to decide. Is it really worth going out or not? “commented Theus.

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Corona reported from Rome, Le Deley from Paris and Dinh from Hanoi, Vietnam. AP Writers Joeal Calupitan in Manila, Philippines, and Terry Chea in Oakland, California, contributed to this report.


Source metroecuador.com

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