Wednesday, April 26, 2006
Gas for 40 cents a gallon
With gas prices reaching record highs in the United States, we decided to see what was happening here in Iran, so we went to a gas station and found that a gallon of gas costs only about 40 cents.

Not a real surprise given that Iran has the world's second largest oil reserve, but there's a hitch to all the low cost gas -- congestion.

With gas so cheap, everyone can afford it, which results in people here driving everywhere. This means traffic is heavy and congestion is building.

A big reason why gas is so cheap in Iran is because the government subsidizes it, but that could soon stop. The Iranian government is set to ration gas in the coming months, and if you want to buy above the allotted amount, the cost goes up five-fold.

Iranians we spoke to at the pump had differing opinions. Some said rationing will help force people to drive less and use public transportation more. Others said it would only deepen the country's economic divide, where the rich will be able to buy as much as they want and the poor will not.

The government wants to ration gas partly because Iran doesn't have a huge capacity to refine oil, even though it sits on so much of it. So Iran ends up importing 40 percent of its gas from other countries, mainly India. The less it has to import, the more self-reliant the country can become.

And then there's the larger issue looming amid the nuclear dispute between Iran and the West. Will Iran use oil as a weapon and cut its supply to cripple the West? Iranian leaders have said so far that's not the plan.

But at the gas station, many Iranians told us that if Iran is pushed into a corner, oil production is an asset they should use to their advantage.
Posted By Aneesh Raman, CNN Correspondent: 3:10 PM ET
  25 Comments
I'd gladly pay a little more if it meant we stopped relying on foreign oil. Canada and the Rockies are supposed to have a huge deposit of oil. We need to tap those sources and stop relying on middle-eastern oil. Why are we paying 80 cents more than we did a few months ago over fears in Iran. Iran supplies less than 5% of our oil. How does less than 5% equal a 33% increase in price???

I have stopped going to movies. I have stopped playing golf once a month. I can't go out to restaurants anymore. I shouldn't have to do this at 30.

We're supposed to be blaming ourselves with all the Hummers, Expeditions, Navigators and Excalades that get 10-12mpg. Well, only people with money can afford those and people with money don't care about the gas prices. These gas prices affect the poor. They affect retirees on a fixed income. They affect every entertainment business that people used to spend money on but now can't.

I'd love to see an oil executive try to live on minimum wage, raise a family, pay for gas and live for just one month. No way they could do it for more than a week at most. I bet you they'd feel different about prices if they had to live like most of America has to.

Instead, Lee Raymond, the CEO of Exxon/Mobil, will get a $400 million retirement package. No wonder why gas prices are so high.
Posted By Anonymous Eric Gibbs, Phoenix, AZ : 3:55 PM ET
Hi Aneesh,
If WE become self reliant, then no other country can hold over our heads an oil spigot. They obviously, would love to cut all the West off..The only way we can stop oil countries from blackmailing us is to remove their leverage..Period...All I hear is "Supply and Demand"....We live in a huge country, with very smart minds. I refuse to believe that we are not capable of making changes and helping ourselves out of this problem or any other..How many houses have to fall on our heads before we realize we aren't in Kansas anymore...Take Care
Posted By Anonymous Lorie Ann, Buellton,Calif. : 4:14 PM ET
In the immortal words of The Bobs: "First I was a hippie, then I was a stock-broker, now I am a hippie, again"
Posted By Anonymous Rob, Elmira, NY : 4:25 PM ET
The trigger point is $60.00 per barrel for the Oil Shales and Sands in Canada and the U.S. to be a profitable venture. I believe that even if the price of oil stays at less than $60.00bbl the government (not the oil companies) should start preparing the infrastructure to retrieve these reserves which contain more than all of the middle eastern countries' combined.
Posted By Anonymous R. Q. Baum - Morton Grove, IL : 4:27 PM ET
The Sprawling of America over the last few decades have really hurt us. People are driving more because they had to have a big new house. The big new houses cost more to heat and cool also, so that is hurting also. Time to get some smart leaders and make us less reliant on energy!
Hummer = Dummer
Posted By Anonymous Joe, Denver, CO : 4:29 PM ET
Ironic how Iran gets 40% of their oil from India. With all the white-collar jobs we're sending to India, you think we could work out a deal with them to buy their oil. India's economy is growing more and more reliant on US companies. Why are our foreign relations so weak? Why can't we ask India to cutoff oil to Iran because of Iran's nuclear threats?
Posted By Anonymous Victor Montequin, Lake Mary, FL : 4:30 PM ET
It's a disgrace what is happening to the American Consumer. We, the American public, are getting strapped to continue to run our vehicles to be able to go to work to make enough money to fill our gas tanks so we can go to work. Nothing is being done to control the oil companies - they just keep raising prices on us and try to pin it on the middle east, where countries are paying a FRACTION of the price we are, and they have to import their refined fuel, not just the oil. They are paying for additional services we are not, and their gas is still cheaper than ours.

Is it any surprise that prices are sky-high, with an Administration with strong ties to the oil industry? Perhaps congressional investigations need to start at the top, not just with the oil companies....
Posted By Anonymous Ryan, Harrisburg Pennsylvania : 4:31 PM ET
CTL, Coal to Liquids is years away from having and infrastructure and processing enough to even make a dent in US Consumption.

Besides you are looking at 80% increase in Co2 levels if not regulated.
Posted By Anonymous Mike, Zephyrhills, FL : 4:33 PM ET
I agree with Eric (prior posting), I would gladly pay extra if it was made (refined) in America. That would be for everything else too (food, clothes, etc.). America needs to be more self reliant, instead CEO's who already make millions, want MORE. Do you really need $400 million? Cant you live on a bonus for say $40 million and put $360 million back into the company to fund research for alternative fuels like Lee Raymond (CEO Exxon) has stated the "reasoning" for high prices is not for today's fuel but for future research since the oil cycles go in 10, 20, 30 year cycles and not a quarterly basis.

I also agree that CEOs and Politicians alike should be mandated to live on minimum wage or the average wage ($10-$12 per hour), and see how/they think living on those wages work.
Posted By Anonymous T Mason Sr - Las Vegas, NV : 4:39 PM ET
Wake up America! Iran isn't the problem nor is the Middle East. A simple thing called greed is the problem. The four big major oil companies are making out like fat rats and could care less about American citizens. Bush too for that matter, oh yeah, unless of course you fit into that 1% of rich Americans. This message is posted by neither a Democrat nor a Republican but a free thinker. Wake up America!
Posted By Anonymous Abdul, Washington, DC : 5:00 PM ET
Has anyone checked the gasoline pricing in Iraq?

I do agree that we, as Americans, ought to be using alternative fuels/engergy. We should have been doing this after the 70s oil crisis.
Posted By Anonymous Fred Alan - Louisville, Ky : 5:01 PM ET
If Iran is pushed into a corner, its leaders CERTAINLY will use oil to their advantage. If Iran is attacked, they are most likely to use their missile power not against US or even Israel, but to destroy the region's oil fields and pull the Arabs and the world with themselves.
Posted By Anonymous Farzad Akbarpour, Tehran, Iran : 5:11 PM ET
Same here, put up pumps with 100% American (North American even) gas (ethanol) and I'll pay more. Problem is there is too much corruption in politics so it's not likely to happen any time soon. Besides, American's (myself included) want everything for as cheap as possible. Why else would just about everything be made elsewhere and imported? Because we want it cheap and we want it now, a la $99 burgers or whatever. When we stop buying the cheapest things we can find and change our mindsets we'll all be better off as a country. It is truly sad to see our country go in the direction it has because of greed. Money isn't everything and our country is being sold to the highest bidder, with money made selling us the cheap stuff we grave, oil included.
Posted By Anonymous Bill Ann Arbor, MI : 5:21 PM ET
I live in Birmingham, AL, where 99% of the population doesn't even live next to a sidewalk that actually leads to anything. We are "driving everywhere" as well, even with gas at $2.90/gallon. Moreover, the per-capita income in Iran is massively lower than in the US, so it's not like Iranians are paying much less. In fact, based on figures from the CIA factbook, I calculate they are paying an adjusted cost of about $2/gallon vs our $2.90. Congestion there is the same reason there is congestion in the heart of NYC and not in a tiny town; too many people in a small area not built with auto transporation in mind (which, even at the best of times, is not an efficient use of space when congestion is a concern).
Posted By Anonymous Matthew Brooks, Birmingham, AL : 5:23 PM ET
I've actually dared to think that high gas prices could be America's salvation. In this new century we are facing tough economic competition from highly productive, low-cost, Chinese manufactures and highly motivated, well educated, Indian engineers. If our current administration was truly concerned with the future of America, it would seize this 'gas crisis' as an opportunity to enhance our educational system, roll out aggressive plans for alternative energy study/development, and inspire Americans about the future. We've dealt with situations like this in the past, as JFK brilliantly handled sputnik, and we have the ability to handle this situation now. All we need is the white house to step up and be leaders. Instead, it appears that our government is content to band-aid this situation (e.g. the strategic oil reserve halts disclosed to the public in a 'quit bothering me' attitude). Sure gas prices will stabilize, but the price will be slightly higher than it was in the past, next year the same situation will arise, and America will have missed a great opportunity to improve; and maintain itself as a world economic leader.
Posted By Anonymous Jason Mackowiak, Cedar Rapids, Iowa : 5:23 PM ET
Gas, gas, gas. What , we don't have the intelligence to create alternative fuels?. Oh I forgot, the government is run by people with too much to lose if we actually went 100% in the alternative fuel direction. Better to keep the sheeple at bay than to strengthen a country.
Posted By Anonymous Manne Gonzalez, El Paso Texas : 5:28 PM ET
Blah, Blah, whine, whine. Spoiled Americans crying about gas prices. Prices go up all the time. I am grateful that I have a car to put gas into. My house got trashed when Katrina dumped 8 feet of water in my neighborhood. I lost my job too and my family is spread all around the country. Big deal, gas costs more.

You want something to cry about?? There are children being slaughtered in Uganda. Remember Darfur, Sudan? Ethnic genocide and rapes? These issues should have all of us crying and protesting in the streets. We should be calling our congresspersons to bring the world community together to end this holocaust. People, we need some perspective in our selfish American lives. Then you see you don't have it so bad.
Posted By Anonymous Paige B., Austin, TX : 5:31 PM ET
I think that not only there gas is cheapper. Also in Venezuela! Who is really keeping all that money?
What's needed is to have alternatives. we depent so deeply in fossil fuels.
Posted By Anonymous Erwin Rubach, Phoenix, AZ : 5:35 PM ET
Farzad,

Your government's headlong rush of rhetoric and actions to destroy Israel, the U.S. and all nations not subscribing to your official religion will of course provoke the attack that you are predicting. Iranians are being whipped into a frenzy of us against them hysteria that your leaders are betting will unite your country (to do what?). It is sad that Iranians of goodwill are nowhere to be found.

You threaten the whole world by pitting Arabs against the rest. And you think that the world will tremble in fear with that scenario? Think again.
Posted By Anonymous Jon Richmond - Chicago, IL : 5:35 PM ET
I sold my car in February of 2002 because I saw this coming. I got used to taking public transportation and giving friends gas money when I have a full trip to the grocery store to make. My friends appreciate the extra money, the environment benefits from one less car on the road and my wallet is full. All this on a blue collar job.

Oil company execs who are making obscene amounts of money should be ashamed and flogged for adding to the problem. However, consumers CAN make a difference... if they are willing to make some sacrifices to make their point. We aren't powerless. We're just spoiled.
Posted By Anonymous Keith, Minneapolis, MN : 5:36 PM ET
We Americans have taken gasoline and cars for granted for far too long. I think the price should be fixxed at $4 per gallon with an extra tax. That should encourage people to conserve resources and may actually decrease obesity as more people actually use their feet to move around. It may also bring more funding for public transportation, a very much neglected institution. We live in a country of waste, yet we preach the opposite. It's time for the government to revoke the SUV tax break and impose taxes to people with gas guzzling cars.
Posted By Anonymous Jack Hernandez, Columbia, MD : 5:45 PM ET
Let us think about the oil companies that makes $36.1 Billion in just the first 4 months of the year and pays there CEO's $400 Million in retirement benefits. The oil companies along with the government that we have now don't care about anybody but the top 1% that can pay for these high gas prices other wise they would have put more money into funding for reach for other forms of fuel or ways to get around. We have oil in America but we don't want to tap into those places.
Posted By Anonymous Travis, Louisville, Ky : 5:52 PM ET
My Fellow Americans,

The time is now to prepare and start voting your future. Oil has peaked, maeaning less oil for everyone. Demand doesnt appear to be slowing. Higher prices tend to slow things up.

Even if we started today with an all-out effort to changeover our entire oil based economy from OIL to alternatives it would take years, 20 at least . There is no single fuel source that can provide the amount of oil we will need to maintain the current use and current growth rate of the USA etc...

Materialism and greed has ruined America. The time to go back is now, slow up, and yes stop our consuming.

China will not be able to sell products we cant buy and India wont take jobs we dont have the need for.
Posted By Anonymous Mike, Zephyrhills, FL : 5:59 PM ET
It's not about the Middle East oil---wake up! Big Oil Bush is the problem and will be until the term is finished. We all may be finished by then also.
Posted By Anonymous cindy,pittsburgh PA : 6:02 PM ET
Venezuela was able to switch to an alternate fuel source that they created back in the early 80's (sugar cane turned into ehtanol) and are no longer dependent on oil from other countries much less their own - they export their oil to us! What's wrong with America not advancing our own technology to create alternate fuel sources? Oh I forgot, the country is and always has been run by the oil companies and other big business. Forget the environment too...Americans don't need that since it's much easier to just consume.
Posted By Anonymous M. Wong, Van Nuys, CA : 3:11 AM ET
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