Jun 22, 2022 - Energy & Climate
Gas prices aren't leading to less driving — yet
Add Axios as your preferred source to
see more of our stories on Google.
The rise in U.S. fuel prices isn't yet spurring a major pullback in driving, but that could soon change, a new Dallas Fed analysis finds.
The big picture: Gas demand is historically not very sensitive to prices.
- But "prices may be closer to consumers' pain threshold than inflation-adjusted prices might suggest," Dallas Fed economist Garrett Golding writes.
- If they rise higher, "expect consumers to respond by cutting back on fuel consumption and overall spending sooner than later."
What we're watching: Remote work options could reduce demand, per the report, but it's "too early to fully assess the impact."
- And many low-wage workers — the ones most hurt by high costs — lack that choice.
