I keep hearing Republicans and Oil Companies screaming about how elimination of the $4 billion/year subsidies will cause gasoline prices to increase. It sounded unlikely, so I decided to take a look at it. It took me about 20 minutes to come up with the following:
42.0 Gallons of oil/ barrel
19.5 Gallons of gasoline from 1 barrel of oil*
46.43% Of gallon of oil becomes gasoline
10.00 Assumed number of years of subsidy
$40,000,000,000.00 Annual Subsidy
19,000,000.00 Barrels of oil consumed daily in US
374,400,0000.00 Gallons of gasoline consumed daily in US
$5,084,580.00 Daily cost of lost subsidy for 10 years
$0.014 Increased cost of 1 gallon of gas to replace the subsidy
$0.41 Increased cost to fill an empty 30 gallon tank
*42 gallons per barrel makes about 19½ gallons of gasoline, 9 gallons of fuel oil, 4 gallons of jet fuel, and 11 gallons of other products, including lubricants, kerosene, asphalt, and petrochemicals to make plastics. That adds up to more than 42 gallons because of something called "refinery gain" - the processing and chemical changes increase the volume.
So if the oil companies pass on every penny of their loss of the subsidies to the consumers, it will cost us about a penny and half per gallon of gas and we get $40 billion back to help improve our education system, or take better care of our elderly, our poor, our disabled―in other words to do things that nice people do.
If you live in San Diego, you might get an invitation from from me in the next couple of days to come by on May 28th for a sort of yard sale (in my house) and fundraiser for Eveoke Dance Theatre. I apologize for using the Curmudgeon mailing list this way, but I swear that I need to get rid of a pile of stuff, and so I'm going share a bit with Eveoke. I am also selling a few signed and numbered art prints and a couple of Zimbabwe Shona stone sculptures in the $150 to $750 range. You may have seen them at my loft downtown, and I can send you pictures and provenance for all of them if you want.
If this ticks you off so badly that you never want to hear from the Curmudgeon again, I certainly will understand and remove you from my mailing list.