Just like every day this week, today brings another story of record oil prices this time topping $ 67.00 per barrel. The price of gasoline continues to rise as well as this quote from a CNN story (Full story here.) shows:
The average price of a gallon of regular gasoline was more than $2.40 per gallon at week’s end, compared with $1.86 a year ago and about $2.21 in April, according to the auto club AAA.
That’s a 54% price increase in one year, and a 20% increase since April alone.
But are prices really higher than they’ve ever been ? The answer,
as Steve Verdon shows in a post on Outside The Beltway is no. In real terms, the price of gas today is about the same as it was in the runup to and aftermath of the First Gulf War. The all-time high was in 1980 when the price of oil, in real terms was $ 98.40 in 2005 dollars.
The article on OTB has a link to this picture which makes the point even more clearly.
You have the same situation when you look at inflation adjusted gas prices.
The price of oil is clearly on an upward trend right now, but it will be some time before we actually break a record. And, for even more perspective, there are those who believe we are in an oil bubble that will eventually burst.