Summer vacation season began this past weekend, just as oil prices approached $130 per barrel. What’s more, oil investor T. Boone Pickens told CNBC recently that he thinks "we’ll get to $150 this year.” With oil on its way to $200 per barrel, possibly as soon as 2012, summer could get even more expensive for the average American family.
The Cost of a Picnic
Energy costs are estimated to comprise 80 percent of the retail price of food. When oil prices rise, so does the price of food.
April 2008 Food Prices (Oil Price: $113/barrel)
Tomatoes (1 lb.): $1.77
Chicken (1 lb.): $1.17
Ground Hamburger Beef (1 lb.): $2.32
Spaghetti and macaroni (1 lb.): $1.12
Apples (1 lb.): $1.21
Lettuce (1 lb.): $0.90
Total Cost: $8.49
Food Prices at $200/barrel
Tomatoes (1 lb.): $2.86
Chicken (1 lb.): $1.89
Ground Hamburger Beef (1 lb.): $3.75
Spaghetti and macaroni (1 lb.): $1.81
Apples (1 lb.): $1.96
Lettuce (1 lb.): $1.45
Total Cost: $13.72
The Cost of Airfare
The cost of jet fuel is up 63 percent over a year ago, adding to the increasing price of airline tickets, which are up 8 percent over last Memorial Day.
Average cost of a round-trip ticket for Memorial Day 2008: $179
Jet fuel as a percentage of airline operating costs: 31 percent
Projected average cost of a round trip airline ticket at $200/barrel: $277.21
Increase from Memorial Day 2008 prices: 55 percent
The Cost of Gas
In a recent survey, 41 percent of respondents planning to take a driving vacation this summer told the Travel Industry Association that they would modify their plans if gas prices rose any further. How high could gas prices go before Americans are willing to give up their vacations entirely?
Current Gas Prices: $ 3.79 per gallon
CAP Estimate of Gas Prices at $200 per barrel: $5.38 per gallon
Current Diesel Price: $4.50 per gallon
CAP Estimate of Diesel Prices at $200 per barrel: $5.55 per gallon