$300 Fill Ups? | Jackson Free Press | Jackson, MS

$300 Fill Ups?


Add up all the hidden costs of oil, and you could pay more than $300 to fill your 20-gallon tank.

Gas prices in the U.S. are around $2.90 a gallon for regular, ringing up a tidy $58 tab for a 20-gallon SUV fill up. In the United Kingdom, that same tank of gas will set you back more than $145, according to NationMaster.com.

So why is gasoline so cheap in the U.S.? Truth is, it's not cheap at all; what we pay at the pump is only a fraction of the real cost.

In 1998, when a gallon of regular was around $1.03, the International Center for Technology Assessment, a non-profit, bi-partisan organization that provides analysis of the impact of technological on society, attempted to gauge the full cost of a gallon of gas in the U.S. "The Real Price of Gasoline" examined a host of federal tax incentives and subsidies, military protection for oil-rich regions of the world, the impact of oil to the environment, health and other social costs, like urban sprawl. From the billions in oil companies tax breaks, to programs that support extracting and producing gasoline, to Defense Department spending in the Middle East, the report concluded that the "real" price of a gallon of gas fell somewhere in between $5.60 and $15.37. A partial 2005 update to the report added another 21 to 32 cents per gallon.

The Oak Ridge National Laboratory in Tennessee, managed by the U.S. Department of Energy, produced a report in 2005 titled "Cost of U.S. Oil Dependence," examining the external costs for foreign oil imports, which did not include the cost of military expenditures. The report concluded: "[T]he costs of U.S. oil dependence since 1970 are $8 trillion, with a reasonable range of uncertainty of $5 to $13 trillion." That is more than the cumulative cost of all U.S. wars since the Revolutionary War, according to the Institute for the Analysis of Global Security.

In a 2007 National Defense Council Foundation report, "The Hidden Cost of Oil," America's oil dependence totaled $825.1 billion in 2006.

The mantra—"drill baby, drill" domestically—is not a long-term solution. The U.S. has only about 4 percent of the world's oil reserves, according to the Institute for the Analysis of Global Security, and that percent will likely drop to 1 percent over the next ten years. At the rate of U.S. consumption, 24 percent in 2007, we cannot sustain our current lifestyle with domestic production alone.

"It is in our best interest to preemptively embark on a revolutionary change that will lead us away from oil dependency rather than drag our feet and suffer the ramifications of becoming growingly dependent on a diminishing resource," the IAGS website states.

Previous Comments


We have a well that BP made a mess of and got Obama to shut down offshore drilling that's gushing 40,000 barrels a day. In any other situation that is quite a find. The national average for wells is about 10 barrels a day. So this spill tragedy isn't just the pollution in the Gulf but what could have been if more of these wells could have been brought in.


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