Inflation and the Cost of a Quart of Oil: What's Changed Since 1934?
Inflation, the result of the persistent rise in prices and decrease in the dollar’s buying power, is unfortunately inevitable. While it's fairly easy to see the rising costs of housing and food over time, we wondered what effect inflation has had on things that are tougher to track year over year.
With more Americans keeping their cars longer, it's reasonable to assume many of them are still using conventional motor oil, a lubricant which has seen an unprecedented price jump over the last decade. We created this graphic to illustrate how the cost of a quart of conventional oil in the US has changed over the years and what previous prices look like when adjusted for inflation. Take a look at what we found…
Using the Consumer Price Index (CPI) calculator, we adjusted prices for inflation to do an apples-to-apples comparison of oil pricing from 1934 to 2017. Motor oil has never been the same price as gas, yet both products have the same core ingredient - crude oil - so it seems reasonable that the rise and fall of pricing for these products would move in tandem. According to our research, this was true until recently. In the past decade, pricing has changed pretty drastically.
In 2009, conventional oil averaged $2.49 a quart, but gas prices were often under $2.00 a gallon. Compared to the 1980s, the pricing isn't at all aligned. In fact, the conventional motor oil prices for 2017 suggest a widening gap in the price of gas vs. motor oil. Gas prices have dipped in the past few years while motor oil prices have climbed. Why?
This is a big topic of discussion on forums and news sites. The most commonly suggested reasons for increasing motor oil prices are:
- There is less demand for conventional oil, which reduces production and increases cost
- The costs of additives is increasing
- The costs for refining and recycling compliance are increasing
Any or all of these reasons may contribute to the higher price. The truth is, we don’t know why conventional oil is now averaging $4.25 a quart while unleaded gas is averaging $2.29 per gallon. What we do know is this is just one way inflation affects the rising costs of car maintenance.