Photo: Flickr – nyc dreamer
Consumers are holding back at the pump.There’s been a 5 per cent year-over-year decline in gas purchasing, according to the EIA Weekly Oil Inventory Report, which likely pertains to the 10 per cent surge in prices compared to the same time in 2007.
“Consumers are making rational responses to higher gas prices, and changing their purchasing habits,” writes Robert Loftus on Seeking Alpha, an investing website.
10 years ago, consumers gladly plunked down for truck-like SUVs that only provide 16 to 28 miles per gallon. Since 2008, however, consumers have shifted their focus to smaller, more fuel efficient vehicles like the Toyota Prius, Honda Fit, Ford Fusion and Hyundai Elantra as pump prices skyrocketed.
A study by Wards Automotive found that in the first 10 months of 2011 while sales of Ford and Chevy pickups remained strong, purchases of SUVs fell behind more fuel efficient small and mid-sized sedans like the Toyota Camry, Nissan Altima and Ford Fusion.
The spike in gas prices proves good for oil companies in the short run, but will only motivate people to look for alternative energy measures that will help them save in the long run.
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.