Gas prices get drivers to cut back
BY DAN MILLER
Of The Patriot-News
The price of gas is driving people in the midstate to change their habits.
Midstate residents said they aren't driving and traveling as much.
People have also changed how they drive to reduce gas consumption. More
people are turning to public transportation.
Even with a slight dip in gas prices in the last week, midstate
motorists seem to have become conditioned to expect the price will keep
going up, even if the rate of increase becomes more gradual. Drivers
said the changes they've made are permanent.
Ezequiel Ramos of Harrisburg was among a crowd of drivers who pulled
into the Sunoco on North Cameron Street in Harrisburg, where a free gas
promotion was under way for motorists who put Sunoco bumper stickers on
their vehicles.
Ramos now looks for different routes to take while on his job as a
summer school tutor. He scopes out shortcuts and avoids roads with
traffic lights. He's driving slower.
Ramos plans to continue doing all this. If the price of gas comes down a
lot more, he'll save more money.
Such changes are taking place across the country.
A survey of 50,000 Americans by the Nielsen Co. found that nearly
two-thirds of consumers were cutting spending, and three out of four
said they were combining shopping trips.
"Consumers are altering their driving and spending habits at dramatic
levels," said Todd Hale, a senior vice president of Nielsen.
Buses and trains are carrying more passengers, another sign that people
are driving less.
Capital Area Transit reports a 7.5 percent bus ridership increase over
the last year. In the first three months of the year, Harrisburg's
Amtrak ridership increased 17 percent, the second largest increase in
the nation, according to the American Public Transportation Association.
The most consumers can hope for is a return to the good old days of $3
for a gallon of gas, given current global supply and demand, experts
said. But even that might be overly optimistic.
But even if prices fall, people are likely to continue driving less,
said Patrick Cusatis, an assistant professor of finance at Penn State
Harrisburg.
"Even at $3 a gallon, people are likely to curb consumption, and a lot
of changes people make are not easily reversible, nor would they want
to," Cusatis said. "I don't think that, suddenly, people will say,
'Let's start wasting oil.'"
The slightly lower gas prices people are seeing are due to the oil
market reacting to consumers pulling back on demand, he said.
Four dollars a gallon seems to be the magic price where people change
their behavior, said Mary Novak, the managing director of energy
services at Global Insight, an economic consulting and forecasting firm.
"If you go from $4 to $3, you do have to fundamentally ask yourself,
what does it take to get people to change their behavior? Three dollars
didn't do it; $4 did. If you go back to $3, demand could rise again, but
the possibility of going back to $3 is zilch because we don't have the
supply," Novak said.
She attributed the recent drop in oil prices to "the froth" coming off
the price. Froth is like head on a beer, which goes away because it has
no foundation.
But she doesn't see the price falling much farther. The U.S. economy is
weaker, but not weak enough to have significant downward impact on
global demand for oil. And supplies have increased a little, but not
enough to make a real dent.
Nathan Willcox, an energy and clean air advocate for PennEnvironment, an
advocacy group, said he isn't worried that people will go back to old
habits.
"I think the prices would have to fall a lot for the public to forget.
If it goes back to $2 a gallon, you'll see people fretting less about
whether a car trip is an absolute necessity, but I don't see that
happening," Willcox said.
Moreover, any money people save from lower gas prices will probably be
redirected toward food or something else that is costing more.
"Energy prices overall are putting people in a crunch. Some of the
efforts to cut down on our oil use will continue," Willcox said.
