Why High Oil Prices Will Affect Non-Drivers

High oil prices will have an effect on public transit, the cost of manufacturing and the price consumers pay for a host of products.

1 minute read

August 14, 2005, 5:00 AM PDT

By Michael Dudley


"With crude oil prices topping $64 a barrel - up from $10 in 1999 - the sobriquet "black gold" has rarely seemed so apt. The impact on the drivers of the UK's 28 million cars is clear; less immediately obvious is how the rising cost of crude oil has ramifications for all.

"'If you take buses, trains or planes, you will be paying more for your fare. And our shops are filled with plastics, which are oil-based products,' says Roy Holloway, the director of the Petrol Retailers' Association. 'When producing - and delivering - these household goods gets more expensive, consumers will bear the brunt.'

"So demand for oil is on the increase, and not simply because of the world's unwaning love affair with motor cars:

"Gas and electricity prices, which are connected to oil prices, are set to go up this month. And with many Britons cooking - and washing and heating - with gas, bills will rise.

"Rail and bus fares are on the increase, in part because of fuel costs.

"The price of oil has driven up the cost of raw materials, the fastest rise in 20 years, hitting profits and prompting warnings about investment and employment in manufacturing. And there are fears that rising oil prices will fuel inflation and damage the world economy."

Thanks to Michael Dudley

Wednesday, August 10, 2005 in BBC News

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