Transportation fuel prices (in chained 2000 dollars1) fluctuated between 1994 and 2004 (figure 14-4). For instance, the average price of motor gasoline (all types of gasoline) decreased 15 percent in 1998, to $1.16 per gallon from $1.35 per gallon in 1997. Gasoline prices then jumped 25 percent, to $1.56 per gallon in 2000 from $1.25 per gallon in 1999. Prices dipped in 2001 and 2002 and rose again in 2003 and 2004 to $1.55 and $1.78, respectively. The average price in 2004 for motor gasoline ($1.78) was the highest in the previous 10 years.2
Other fuels, such as aviation fuels, jet fuels (kerosene) and diesel (no. 2), underwent similar price fluctuations. These fuel prices decreased slightly in 2001 and 2002 but then rose in 2003 and again in 2004. The average jet fuel (kerosene) price increased 35 percent between 2003 and 2004-the largest increase amongst all fuels in 2004, while the average motor gasoline price grew the least (15 percent).
Transportation fuel prices are correlated with the world price of crude oil, because crude oil represents a large percentage of the final price of transportation fuel. This correlation can be seen in the price trends from 1994 to 2004 for crude oil and various transportation fuels. However, average crude oil prices started to rise in 2002 (3 percent over 2001), while fuel prices were still dropping, and continued to increase the next two years (27 percent in 2004 over 2003).
While prices of transportation fuels fluctuate over time, vehicle-miles of travel (vmt) does not appear to be affected. For instance, between 1994 and 2003,3 highway vmt per capita rose at an annual rate of 1.2 percent or 11 percent over the entire period (figure 14-5). During the same time, aircraft-miles of travel per capita for large carriers increased 3.0 percent on an annual basis or 26 percent overall (figure 14-6).
As measured by the Consumer Price Index, between 1994 and 2004, motor fuel prices increased at a higher annual rate than transportation prices (5.6 vs. 1.9 percent, respectively). The inflation rate for transportation was lower than annual inflation for all goods and services (2.5 percent) . In fact, transportation-related consumer prices increased less than all other major spending categories except apparel, which decreased 1.0 percent from 1994 to 2004.
1. U.S. Department of Labor, Bureau of Labor Statistics, Consumer Price Index, available at http://www.bls.gov/, as of May 2005.
1 All dollar amounts are expressed in chained 2000 dollars, unless otherwise specified. To eliminate the effects of inflation over time, the Bureau of Transportation Statistics converted current dollars (which are available in appendix B of this report) to chained 2000 dollars.
2 The price per gallon (in chained 2000 dollars) for motor gasoline was $1.94, averaged over the first six months of 2005, the most recent data available as this report was being completed.
3 At the time this report was prepared, vmt and aircraft-miles of travel data were only available through 2003, while energy price data were available through 2004.