|
People are willing to pay for it and demand keeps going up.
That's it.
It's not complicated.
Until people CAN NOT AFFORD gasoline, gas prices will continue to go up.
When enough people can't afford to fill their cars with gasoline in order to go to work, there will be a reduction or stabilization of the price. Until then, or, until the government steps in and and starts applying restrictions to the price of gas (which will never happen; if anything, they'll get in on the rise in price by throwing on taxes), it will keep going up and up.
We may very well be near that point: If the average drive to work for a minimum wage job is 10 miles (too far to walk) driving a vehicle that gets an average of 20 mpg and a person is working 40 hours a week at minimum wage. That's 1 gallon of gas per day, 5 gallons per week. At $3/gallon that's $15/week or 7% of their gross income. Minimum wage is barely survivable as it is and well below the poverty line. My guess is that at $5/gallon or 14% of a minimum-wage worker's income, they start to have serious problems making that job feasible. You could look at it this way: at $5/gallon it takes a minimum wage worker 5 hours of work to pay for their gas to get to work (with the above assumptions). Certainly, if it were 1 day of work to pay your gas to get to work would be too much. You'd need to get paid more .
|