Omaha Gas Prices in Action: Up, Up, and Away...
Updated: May 20, 2022
Gas prices in Omaha are now over $4/gallon. We are below the national average but it still feels like things are getting expensive. April gasoline prices were a full $1.00 above prices at this time last year:
Here is what the national price of gasoline has looked like since 1990. I received my driver's license in 1996 and wasn't it great to purchase gasoline using coins collected from bottle and can recycling:):
I wanted to see what those Omaha gasoline prices looked like month-by-month, year-over-year and it is a really interesting collection of data:
Prices got up to $3.94 in July 2008, which appears to be the highest number since 1999...for now. However, that price per gallon was down to $1.65 by December 2008. That is a 58% decrease in only 4 months!
These prices fluctuate quite drastically and quite quickly as you can see. So there is always hope. However, I read HERE that U.S. households are now spending the equivalent of $5,000 a year on gasoline up from $2,800 a year ago; a 44% increase.
The average salary here in Omaha is $53,000 (HERE). Using that as a reference, gasoline jumped from 5.28% of the average salary up to 9.43%!!!! That is a lot of pressure on purchasing power and probably consumer confidence. What tradeoffs are consumers making based on that shift in spending???
That price of gas tends to fluctuate pretty closely to the price of oil as you might expect:
As inflation impacts the rest of the consumer budget, how does this play-out in the economy at large? What will this do to demand of goods and services? We have investigated housing costs a ton here as the mortgage rate has increased (now at 5.25% nationally). Imagine a similar analysis of the price of food, clothes, and other staples.
The question is, will the Fed fight inflation at the expense of the markets? What if they do? What if they don't?
Let us try to take care of each other out there...things will probably get worse before they get better.