Economy

Americans Convinced Rise in Gas Prices Is Permanent

Seven in 10 say gas prices causing financial hardship

PRINCETON, NJ -- Over three-quarters of Americans are now convinced that the rise in the price of gas is permanent, the highest such reading since Gallup began asking about gas prices in this way in 2000.

Gallup has asked this question during this decade at various times when the price of gas has gone up, and there has been considerable fluctuation in the responses. The lowest "permanent" response, 33%, was in August 2003, and the highest is the current 78%. At the moment, only 19% of Americans interviewed in the May 2-4 USA Today/Gallup poll believe the increase in prices is temporary. The previous "permanent" high point of 62% came in September 2005, shortly after Hurricane Katrina caused a spike in gas prices.

Underscoring this pessimism, the poll shows that over half of Americans believe the price of gasoline will reach $6 a gallon at some point over the next five years, although only 19% believe the price will reach as high as $10 a gallon.

The negative impact of the rise in gas prices on Americans' daily lives is made clear in the responses to a Gallup Poll trend question that asks about financial hardship.

Although Americans' self-reported hardship caused by rising gas prices is very high at 71%, this is not the highest such report this question has engendered over the years Gallup has asked it. In the September 2005 post-Katrina poll, 72% of those interviewed said the increase in prices was causing hardship. That is the case even though inflation-adjusted gas prices are now the highest in history. One explanation for the lack of an increase in perceptions of hardship over the last several years may be that Americans have become habituated to the ever-rising price of gas, and perceptions of hardship may thus be leveling off as the public takes it into account in its household budgeting.

A follow-up question asked those who said gas prices have caused a hardship to indicate whether such hardship was moderate or severe.

The data show that only about 35% of those who say gas prices have caused a hardship say the hardship has been severe, meaning that just 25% of the entire population says high gas prices are causing them severe financial hardship. Still, this is the highest such percentage in the six times this follow-up question has been asked.

Implications

The American public appears to be settling into the belief that the most recent run-up in gas prices is permanent, not temporary, and over half believe the price could be as high as $6 a gallon within a few years.

More than 7 out of 10 Americans say gas prices are causing them financial hardship, although the majority of these say such hardship is moderate rather than severe. The level of this self-reported increase in hardship is no higher now than it was in 2005, however, suggesting that Americans may be adjusting to or taking into account high gas prices in their daily financial dealings.

Survey Methods

Results are based on telephone interviews with 1,017 national adults, aged 18 and older, conducted May 2-4, 2008. For results based on the total sample of national adults, one can say with 95% confidence that the maximum margin of sampling error is ±3 percentage points.

For results based on the 505 national adults in the Form A half-sample and 512 national adults in the Form B half-sample, the maximum margins of sampling error are ±3 percentage points.

Interviews are conducted with respondents on land-line telephones (for respondents with a land-line telephone) and cellular phones (for respondents who are cell-phone only).

In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.

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