Gas Consumption Drops in Texas, but for How Long and Why?

With rising gas prices, this next story might make you say, "duh." For the first time in a while, gas consumption in the state of Texas looks to have dropped. But it might be a little early to presume people will buy less in the months to come.

You might call it Gas Economics 101: the price per gallon goes up, the consumers change their plans.

Now, a Texas Transportation Institute study finds for the first time in a while, consumption of gas on a per capita basis is down.

April 2008 compared to that same month of '07 saw a 3.2 percent decline in consumption. It's amazing to think just a few short months ago, gas was at $3.41 a gallon, which was up 19 percent from the previous year.

So that all pretty logical.

"Now is that a long term trend? We don't know," said David Ellis, who conducted the study for Texas A&M-based TTI. "We're looking at this almost in real time. Is this trend going to continue through the summer and into the fall? It's very hard to tell."

Ellis crunched the numbers on a per capita basis because he says as a whole, fuel consumption is on the rise in Texas thanks to the state's rising population. How much each person's putting in their vehicles is another story.

"All of us consumers have a finite amount of money each month to work with, and as gasoline takes a bigger and bigger bite out of that budget, we look for ways to adapt," Ellis said.

If all this seems common sense, you're not alone, but while you might think this would be an easy trend to predict, Ellis thinks you should pump the brakes.

"In February, March and April, and September, October and November, when primarily the driving that we do is going back and forth to work and back and forth to school, we don't have a lot of choice of whether we go or not," Ellis explained.

But in the summertime, vacation scale-backs are easier. Road trip cut-backs are simpler. So the question becomes whether the price at the pump will continue to drive drivers to stop driving?

"If I knew that, I could make a lot more money doing something else," Ellis said.

Here's another thing you might be surprised by: diesel consumption in Texas is up according to Ellis. He says that means truckers are still transporting goods, which means people are buying goods.


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