27 March 2012

Fuel Prices Are Too Low

Petrol and diesel prices are considered very high by most people. You get the impression that they will only get higher in the long run, because reserves are dwindling while demand rises. These fuels are essential for shipping and aviation but not so much for cars. So why are people not switching to vehicles with alternative fuels? Because such vehicles cost more to buy and the current fuels are still affordable for most. In fact to recoup the initial extra cost of purchase, it is still the better financial option to buy a petrol or diesel car...unless those fuels get quite a bit more expensive.

Eventually cars would have to be powered by other means anyway, because petroleum is running out. What is holding back change is the fact that fuel is still too cheap. A valuable resource is being wasted on cars. People should be taking public transport, cycling or walking whenever they can, to reduce the use of these fossil fuels. Avoiding gas guzzlers is a minimum.

Much higher prices of petrol will force change, change that needs to happen. Such changes are unpopular politically, so governments are reluctant to act. Manufacturer's options are limited by technology. Infrastructure changes are complex and costly. Consumers only react when the wallet is hit hard, which is understandable. Therefore, expect nothing to change in the near future.

Photograph: Bernadett Szabo/Reuters

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