>Lost my bet

>At the beginning of the year, when a retail gallon of gasoline averaged $3.10 or so, I bet a colleague from work that at no point would the price go above $4.00, according to gasbuddy.com.

Today, I lost that bet. Fortunately, the standard bet at our work is a quarter and your pride.

I keep up with the energy blogs and news, and I’m aware of the limitations in supply that we have coming over the next decade or so, including the threat that world oil supply may be peaking or may have just passed the peak, but I never thought it would go up 30% so quickly.

Live and learn. For the rest of the year, what do you think a suitable number would be for “double or nothing”? $4.50? $4.75, $5.00? Let me know.

UPDATE: We agreed on double or nothing at $4.50. It’s a bit risky for me but I think we’re looking at harder economic times, more people getting smaller cars, and public transit ridership is way up. I think $4.00 may be most people’s tipping point for changing behavior. We’ll see.

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About perkinsms

I'm an engineer and father interested in transit, parking and economics.
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3 Responses to >Lost my bet

  1. Geoff says:

    >I was thinking yesterday that you were still going to lose the double or nothing. But the large reduction in Chinese fuel subsidies might clinch it for you.

  2. Michael says:

    >I was also thinking that at $4.00 people were starting to cut back on driving, and they have: http://www.startribune.com/lifestyle/travel/19876189.html?location_refer=ErrorAlso, for the past three days, Metro has hit four “top ten” ridership records, above 810,000 passengers per day.I’m hoping that those effects combined with a slower economy will cap the increase at about $4.25.

  3. Geoff says:

    >I agree that people are cutting back but I a far from convinced that this was have a significant impact. I would argue that the vast majority of fuel consumption cannot be easily changed without other systemic public transit changes that takes years. Increases in fuel economy standards will help but only over decades as cars are replaced.IMO the major factor in oil prices is strong demand coupled with speculation. There is so much speculation that a bubble exists between the economic driven demand slowing and policy changes overseas to reduce subsidies. Yet the risk of spikes remains if hurricanes hit or there is even a hit or further conflict.

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