American drivers' pain at the pump is self-inflicted, analysis shows

Published Sep 21, 2012 at 10:00 am (Updated Sep 21, 2012)

Drivers in the United States feel less "pain at the pump" than all but a handful of other nations—most of which are major oil producers that heavily subsidize fuel prices. That’s the conclusion of Bloomberg’s quarterly gasoline price ranking, and one that’s at odds with the experience of many Americans. If filling the tank in the United States is as relatively inexpensive as the ranking shows, why do many Americans say it hurts so much? The gas ranking first ran in May, when U.S. gasoline prices spiked, to put some of the campaign-season economic and political debate into perspective. The pain factor is calculated by dividing a nation’s average price per gallon of gasoline by its average daily income; in other words, it’s the share of a person’s wallet needed to buy a gallon of gasoline in each country. But what this ranking doesn’t take into account is the amount of gasoline consumed. When that’s considered, a very different picture of gasoline "pain" emerges. Usually, the less developed a nation is, the higher its pain rank (heavy subsidizers like Saudi Arabia are outliers). The average American can afford paying $3.75 per gallon more readily than, say, the average Indian, who makes only $4 a day and pays more than $5 per gallon—a staggering 137% of a day’s wages. Read the full story here.