If you’ve had to fill up your car recently, chances are you’ve experienced sticker shock from the sky-rocketing gas prices. Amid the rise of gasoline prices, millions of Americans are experiencing extreme financial pain, fueling pessimism about the future of the economy and signaling questions about why gas is so expensive- and who’s to blame.
How Did We Get Here?
Today’s monumental gas prices are rooted in a few large causes such as the COVID-19 pandemic as well as Russia’s war on Ukraine. As a general statement, one might say that supply and demand have changed, but let’s dig a little deeper.
When the pandemic first hit, Americans were urged to stay home, abide by curfews, and have designated family members to run errands for the home. As a result, the need to drive everywhere plummeted, as did our need for gasoline. This sharp decline caused gas prices to plunge as low as below $2 per gallon in the first quarter of 2020, according to MoneyWatch.
However, as vaccines rolled out, and Americans began to feel safer to shop and travel, people resumed driving. With this rise in demand, gas prices slowly followed suit.
- Drying Oil Production
When the demand for gas and oil decreased during the pandemic, oil-producing nations significantly cut production. However, as the global economy recovered from the pandemic, these nations were too slow to ramp up production to meet the new demand.
- Russia’s War on Ukraine
The economic effects of Russia’s invasion of Ukraine have rumbled around the globe, leaving many wondering how it will affect their wallets. According to the Energy Information Administration, crude oil accounts for 56% of what Americans pay at the pump. That’s why higher oil prices correlate to higher gas prices.
Russia is the second largest exporter of crude oil, and the world’s largest natural gas exporter, which is vital for many things- especially filling cars with fuel.
Electric Vehicles (EVs)
Electric vehicles have a battery instead of a gasoline tank, and an electric motor instead of an internal combustion engine.
EVs don’t produce tailpipe emissions. While charging the battery may increase pollution at the power plant, total emissions associated with driving EVs are still typically less than those for gasoline cars.
- Driving Range
The number of miles your electric vehicle will travel before the battery needs to be recharged is often less than the distance your gasoline car can travel before being refueled. Typically, it can still travel enough to accomplish the average person’s daily driving needs.
An electric vehicle’s fuel economy is reported in terms of miles per gallon of gasoline-equivalent (MPGe). This is similar to MPG, but the number is represented by the number of miles the vehicle can go using a quantity of electricity with the same energy content as a gallon of gasoline.
Depending on how far you drive each day, you may be able to meet all your driving needs by plugging in while at home. To charge your vehicle more efficiently, you may want to install a dedicated 240 V outlet or charging system. You may also be able to plug in at your workplace, or at a public charging station.
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How Do Conventional Hybrid Electric Vehicles (HEVs) Work?
Conventional hybrids use their gasoline engines to keep their modestly sized batteries charged as you drive, with no need to plug them in, and virtually every major maker offers HEV cars, SUVs, and trucks.
These HEVs deliver a considerably better fuel economy than their nonhybrid counterparts in stop-and-go city driving, because they can recapture energy while breaking.
However, HEVs don’t have the ability to be plugged in to recharge their battery packs and typically offer only a momentary ability to drive on electric power alone.
Plug-In Hybrid Electric Vehicles (PHEVs)
Plug-in hybrid electric vehicles are a combination of gasoline and electric vehicles, so they have a battery, an electric motor, a gasoline tank, and an internal combustion engine.
PHEVs produce tailpipe emissions when gasoline is being used as a fuel source.
- Driving Range
PHEVs typically have driving ranges similar to gas vehicles. They have two fuel economy values: one for when the vehicle operates primarily on electricity, and one for when the vehicle primarily operates on gasoline.
Some PHEVs operate exclusively, or nearly exclusively on electricity until the battery is nearly empty. Then, gasoline is burned in the engine to provide additional power. Other PHEVs have something called a “blended mode” which means the vehicle uses both gasoline and electricity together to power the vehicle while the battery has charge.
Why You Should Buy Electric Now
- Wide Selection of EVs and HEVs
Currently, there is a great selection of electric and hybrid vehicles on the market. While Tesla continues to dominate the Electric vehicle segment, many other companies have recently demonstrated healthy competition.
- The Driving Range of EVs is Improving
One of the biggest concerns about electric vehicles is mileage- or fear of running out of battery power before you can drive back home or reach a charging station. Back in the humble beginnings of EVs, the best-selling electric car had a maximum range of around 109 miles.
However, for some EVs, the electric range rivals that of gas-powered cars, reaching around 186-300 miles on a single charge.
- There are More Charging Stations Available
This is another factor that should help relieve the range anxiety of EV buyers. The expansion of EV charging stations makes it more practical to drive an electric vehicle. Even if you don’t own a home charging station, you can still drive an electric car. With various services and apps now available, you can easily find charging stations.
What will new gas prices cost you?
So What Does This Mean for the Future of Transportation?
There is a widespread understanding that the future, at least when it comes to what we drive, is electric. 2022 is already set to be the year with the highest number of new electric car concepts, world premieres, and market launches, but is the surge in gas prices affecting the market?
It’s safe to say that persistently high gas prices will have a bigger effect on EV demand than temporary price increases would. However, the perfect storm of consumer demand, supply issues, and price premiums have illuminated trouble.
Automakers are experiencing supply shortages, enhancing market volatility. Eager EV consumers who are trying to escape the hike in gas prices may still find their wallets are too hollow for the premiums that these vehicles demand.
Of Course, There Are Reasons for Thinking Electric.
It’s important to remember the underlying consideration that’s gotten EVs and HEVs the acclaim they have today. Electricity is more affordable than gas, registration fees are cheaper, range anxiety is becoming a thing of the past, there are more places to charge your car, they don’t emit harmful emissions, and you can finally skip the gas station.