Iraqis Paying 5 Cents a Gallon for Gas

June 7, 2004 11:04 AM

Iraqis Paying 5 Cents a Gallon for GasWhile Americans are shelling out record prices for fuel, Iraqis pay only about 5 cents a gallon for gasoline — a benefit of hundreds of millions of dollars subsidies bankrolled by American taxpayers
posted by Postroad (47 comments total)

Considering what we did to their country, I don't see a problem with that.
posted by Dillenger69 at 11:16 AM on June 7, 2004

have you ever gotten a discount for working a retail job?
posted by Satapher at 11:18 AM on June 7, 2004

Wow. Beats the hell out of the free CDs I got when I worked for Tower.

Pour out the milk, Henrietta! The cat's drinking unleaded from now on!
posted by keswick at 11:22 AM on June 7, 2004

Pour out the milk, Henrietta! The cat's drinking unleaded from now on!

Nice, keswick. That's one of my favorite Bloom County lines.
posted by stifford at 11:30 AM on June 7, 2004

Yes, Dillener69.

And also: their cars are probably more sober and they drive them less -- they don't need the incentive to produce more fuel efficient cars and drive less (or at least, that's how I'd like to see the somewhat "increased" cost of gasoline work in the US.)
posted by NewBornHippy at 11:32 AM on June 7, 2004

Yeah, screw those Iraqis, they got it made over there! They better send us some of that cheap gas or we'll go bomb them back to the stone-age!
posted by falconred at 11:32 AM on June 7, 2004

People should be annoyed at this. Those tax dollars should be spent rebuilding Iraq, not giving out gasoline on the dole. Concentrate on fixing the power grid we destroyed, the buildings we've destroyed and making sure that Iraq is on it's way towards self-reliance. This might mean investing in desalination systems. Spending money on gasoline is assinine on so many levels. First, it doesn't address any of the real problems especially not those faced by those who were most oppressed (remember, we were supposed to be freeing the oppressed). Second, it's a consumable. Once the cheap gasoline is gone there is no reminder. I'd rather see a hospital built with my money. Even after we've left the hospital will still stand. Third, one the cheap gas disappears you're going to have a Hell of a lot of people pissed off because they bought automobiles based partly on the availability of cheap fuel.
posted by substrate at 11:45 AM on June 7, 2004

The cat drinks unleaded from now on!
posted by steef at 11:50 AM on June 7, 2004

I'm just as happy paying for this, as I was footing the bill for the war(nil). Nevermind the dream-like automobile market this has set up. What happens when all of the new Iraqi (dirt cheap)car owners have been splashed with the cold water of real market prices for gas? We may have just found the way for exporting the American habit of displaying cars on blocks in the front yard.
posted by mnology at 11:51 AM on June 7, 2004

Wow, with gas that cheap, we should make sure they are buying Ford SUVs.
posted by strangeleftydoublethink at 11:52 AM on June 7, 2004

Ford SUVs aren't *that* horrible on mileage, strangeleftydoublethink. Let's make sure they all get H2s, it's like the trendy version of what the Americans are driving around!
posted by mikeh at 11:58 AM on June 7, 2004

Third, one the cheap gas disappears you're going to have a Hell of a lot of people pissed off because they bought automobiles based partly on the availability of cheap fuel.

Definitely the most important issue. Americans have been screaming their heads off because gas went up a dollar. It's not going to be pretty if/when the U.S. decides to drop the subsidies and Iraqi gas goes from $0.05 to god knows what, considering that for Iraqis, a dollar is a bit more than 5% of an hour's salary.

If the price is hiked to non-subsidized level, a tank of gas could practically become a retirement fund. Even if the increases to normal levels are gradual, Iraqis are looting scrap metal... what happens when a gallon of gas increases in value by 6000% over 18 months?
posted by XQUZYPHYR at 12:02 PM on June 7, 2004

substrate: don't forget that some of this gas in probably being used in generators to power household appliances (since the power supply is far from guaranteed.
posted by smcniven at 12:16 PM on June 7, 2004

Third, one the cheap gas disappears you're going to have a Hell of a lot of people pissed off because they bought automobiles based partly on the availability of cheap fuel.

Definitely the most important issue.

i'd say that's the second most important issue, or actually part of the bigger issue. creating an "anarchic car culture" in Baghdad will have lots of negative effects--eventual gas-price backlash will only be one of them.

stupid. Iraq hasn't had consistent power for over a year, but there's tons of cabs driving around. great!
posted by mrgrimm at 12:19 PM on June 7, 2004

Tired of paying $2+ at the pump, take a job in Iraq, and shower in your $.05/gallon subsidized gas at the expense of taxpayers!

Could it be that the post-war refined fuel purchasing from neighboring countries was part of some sort of deal in exchange for "buy in" from certain mid-east nations?

on a slightly related note, didn't some economist determine that gas (petrol, if you will) should actually be closer to $5/gallon if you take into account inflation and such. So, technically, aren't we being subsidized as well, proportionate to the iraqis when you consider average income?
posted by shoepal at 12:32 PM on June 7, 2004

Hey I want my cheap gas!

I mean, didn't we go to war for oil?
posted by Steve_at_Linnwood at 12:40 PM on June 7, 2004

People should be annoyed at this. Those tax dollars should be spent rebuilding Iraq, not giving out gasoline on the dole. Concentrate on fixing the power grid we destroyed, the buildings we've destroyed and making sure that Iraq is on it's way towards self-reliance. This might mean investing in desalination systems. Spending money on gasoline is asinine on so many levels. First, it doesn't address any of the real problems especially not those faced by those who were most oppressed (remember, we were supposed to be freeing the oppressed).

First of all, without cheap gas to run their home generators, which in turn run their air-conditioners, a lot of people would be fucked.

Also, keep in mind that gas was 5 cents a gallon before the war as well. Most of the Iraqis believe we're getting tons of cheap oil from them when we're not. Imagine if gas prices had gone rather then from $1 to $2, they'd gone from $1 to $30. That would be the equivalent. If that happened here, the government would be voted out of power pretty quickly. But the Iraqis' can't vote us out of power. They can do other things, though.

Eventually Iraq will have enough refineries to produce enough gas for local demand, until that time, we should subsidize their gas. It's not even that expensive.
posted by delmoi at 12:48 PM on June 7, 2004

Those darn Iraqis - using our tax money to take our oil!
posted by spazzm at 1:16 PM on June 7, 2004

So you think you [Americans] pay a high price for gasoline [petrol]? In the UK, petrol currently sells at the pumps for £0.83 per litre, which, at today's exchange rate, makes it $1.53 per litre. With around four and a half litres to the [British] gallon, that means us Brits are paying $6.89 per gallon. Recently some pumps have been selling at closer to £1.00. So do the math[s] on that price.
posted by si at 1:19 PM on June 7, 2004

I wonder how many Joe Q Publics thought that going to war in Iraq would result in a lower price at the pump... Would support for the "War" have been lower had people known that we would be paying $2+/gallon in June 2004? You have to wonder...
posted by shoepal at 1:50 PM on June 7, 2004

si: That would make $8.30 a gallon, thank you very much.

American gas is hella subsidized.

I always find it funny as hell when people start yelling about the inefficiencies of government while living in the deep suburbs with some LeBehemoth of an automobile. We could cut demand of oil considerably by consolidating the cities and using reasonably efficient means of transit, but nooooo.... We LIKE wasting billions of dollar a year. (As though the Iraq campaign wasn't proof enough in itself.)

So live close to work, sell your car, and buy a goddamned bicycle. You'll save over $1,000 a year, and go a step towards making the world a better place by reducing the need for oil wars. And (most importantly!) I won't laugh at you if you start talking about government waste.

/soapbox
posted by kaibutsu at 1:56 PM on June 7, 2004

...considering that for Iraqis, a dollar is a bit more than 5% of an hour's salary. If the price is hiked to non-subsidized level, a tank of gas could practically become a retirement fund.

They get paid $20/hr and $50 is enough to retire on? Damn, I'm moving to Iraq.
posted by sfenders at 1:57 PM on June 7, 2004

"Governments also subsidize energy prices in more indirect ways. In 1989, it was estimated that the United States' military spent between $15 and $54 billion safeguarding oil supplies in the Middle East. The Gulf War in 1991 cost at least an additional $30 billion on top of the regular yearly expense. The most conservative estimate of military spending represents a government subsidy of $23.50 per barrel of oil imported into the U.S. This is a significant amount, approximately equal to the market price of a barrel of crude oil. If the cost of safeguarding oil supplies were paid for by oil consumers, gasoline prices at the pumps would be much higher. This is illustrated in an exaggerated way by Figure 1."

FIGURE 1

"Americans can still cost-effectively save half the electricity they use—even the Electric Power Research Institute (EPRI), the utilities' own think-tank, says so—and at least that much of the oil and gas. Achieving these technical potentials, or the even larger ones researchers at Rocky Mountain Institute have identified, would take several decades, but pursuing them is clearly worthwhile. The energy savings already achieved have cut Americans' energy bills by more than $200 billion a year, compared to what they'd collectively be spending if they used energy in the same wasteful ways they did in 1973. [backwards ellipses...]
"Savings of this sort don't mean freezing in the dark, doing less, doing worse, or doing without. Energy efficiency is not conservation by curtailment. It means doing more with less, enjoying more comfort, providing the same or better services, but doing it a little smarter."


posted by kaibutsu at 2:11 PM on June 7, 2004

So live close to work, sell your car, and buy a goddamned bicycle.

Yeah. That'd work great here in Minneapolis!

Furthermore, the number of homes (especially affordable homes) that are bicycle-commuter-friendly is nearly fixed. The supply in many metro areas can only expand by developing parks, or building highrises.
posted by trharlan at 2:29 PM on June 7, 2004

Boy those Iraqis sure are lucky sons of bitches!
posted by Robot Johnny at 2:37 PM on June 7, 2004

I live close to work and ride my bike or walk everyday. ...but I still hate current gas prices.

Also, keep in mind that gas was 5 cents a gallon before the war as well

Really? Hm, interesting. That kind of changes the news story a bit, doesn't it?
posted by tomplus2 at 2:44 PM on June 7, 2004

Well. we are paying about $7 a gallon in the UK, including 71% tax, so we think you are lucky sobs! Check out the exchange rate here
posted by terrymiles at 2:50 PM on June 7, 2004

Dude! Sweet!
I wish I lived in Iraq!
posted by fuq at 2:52 PM on June 7, 2004

I know! I know! Should have read the whole thread. Sorreeee!
posted by terrymiles at 2:52 PM on June 7, 2004

Where I live, the number of bicycle-commuter-friendly homes is gradually dropping, as new companies tend to put up their offices in the land of cheap real estate, well outside easy bicycle range from the parts of the city with high-density housing. The number that are "affordable" is already close to zero from my point of view, but I'm relatively debt-averse, not willing to spend five times my annual income on a house.

Anyway, conservation and efficiency efforts are not going to solve our long-term problems with oil. Demand tends to grow to infinity; efficiency gives you diminishing returns.
posted by sfenders at 3:01 PM on June 7, 2004

Hey I want my cheap gas!

I mean, didn't we go to war for oil?

Yes. Can you believe Bush is that much of a fuckup?
posted by XQUZYPHYR at 3:43 PM on June 7, 2004

So let's see, it'll take a quarter to get enough gas into the explosives loaded garbage truck to drive into an American security area? What a bargain!

Why is the US paying a half billion a month to deliver cheap gas to the Iraqis? Doesn't Bush know that hey could all but seal up the election if he did the same thing here?

Then we'd have five times as many over sized Super Extendo SUV's with hot tubs and flames out the top and little mopeds on the sides to ride around to the other side because they're so big. At least they're still getting subsidies to buy the behemoths aren't they? Please tell me they are, wankers need all the help they can get.
posted by fenriq at 3:44 PM on June 7, 2004

si and terrymiles: The only reason for that is the amazing amount of tax on petrol in this country, ostensibly intended to get people to use public transport.

On the other hand, Americans could do with a increase in their "gas" tax, if only to force them to ditch their SUVs and reduce oil dependencies in other ways. No US government would dare to do that, though, because of this strange sense of entitlement Americans seem to have towards cheap petrol.
posted by reklaw at 3:50 PM on June 7, 2004

Yeah! No Blood for Oil!

I blame Halliburton for this fiasco - they're obviously stealing Iraqi oil in order to sell it to them for a $.05/gallon pure profit. Since, you know, the oil is theirs in the first place, and whether or not Americans get it isn't up to us...

whoops, sorry, reality slipped in a second there, back to ranting:

How dare we liberate the country and then give them their own oil for cheap? No Blood for Oil! Down with Bushitler!

I'm having cognitive dissonance here. Question: If the oil for the gas is Iraqi oil, why is it bad if the Iraqis are benefitting from that? Or is it that you're jealous?

In the immortal words of a brilliant anti-war protestor - "I don't need oil, I ride the bus."

Heh.

Many times a day, I feel like if I come to MeFi and see an FPP that says "Holy crap, every single war in the world just ended, Al Qaeda gave up the ghost, Israel got out of the occupied territories, and democracy is flourishing the world over" I'd read comments that say things like "Bush shouldn't unilaterally force democracy on the world" and "Al Qaeda was just CIA operatives" and "This is all a Mossad plot."

This place makes me laugh sometimes at the singlemindedness of the Bushitler haterating. :)
posted by swerdloff at 3:50 PM on June 7, 2004

UK paying loads blah, blah...

UK 'gas' is 95 octane & up - max in US is 93 which costs $2.50 in LA. An average UK vehicle will do 45-55 USmpg which is 2-3 times what an average US vehicle will do.

I'm still smarting from 6000 miles in a V8 5.2L Dodge that managed 12mpg...

swerdloff: Are you drunk?
posted by i_cola at 4:01 PM on June 7, 2004

No Oil for Blood!
posted by inpHilltr8r at 4:03 PM on June 7, 2004

Detroit Free Press: "Gas prices won't slow sales for SUVs"
Seattle P-I: "Sales of gas-guzzling SUVs sputter as fuel costs climb"
posted by sfenders at 4:15 PM on June 7, 2004

A few months back there was a report about how gasoline costs were fairly high in Iraq, and there was an uproar then as well. I would imagine what has happened in the interim is that gasoline has become subsidized, since I can't imagine that 5 cents even covers the refinery costs. Whether it's being subsidized by Iraqi dollars for the country's own benefit or by American dollars for the Iraqis, I have no clue.
posted by mikeh at 4:21 PM on June 7, 2004

i_cola:
UK 'gas' is 95 octane & up - max in US is 93 which costs $2.50 in LA.

Wrong. Or, if not factually wrong, extremely misleading.
posted by trharlan at 4:28 PM on June 7, 2004

Well, according to this old post from Riverbend, that's about the price it cost before the war, under Saddam (as delmoi pointed out). Also the quality of the fuel is pretty bad it seems...
BTW gas cost 14 US cents per gallon in Venezuela a month ago - a list of gas prices around the world in May.
posted by talos at 4:36 PM on June 7, 2004

Note this: Bush gave back taxes. Federal tax on gas. This gathers money from Americans who thought they got tax break. The money from the govt (taxpayers) subsidizes gas in Iraq...so we really did not get a tax giveback but merely a change in the way money was taken from us and then used for "other purposes"--gosh. as we kids uysed to say: it isn't fair.
posted by Postroad at 4:44 PM on June 7, 2004

RTFA - It's not Iraqi oil. The US is trucking it in at great expense from other boarder countries (presumably because all the bombs made it kind of tough to refine oil in Iraq these days).

Also, as mentioned up-thread it's also powering generators which are about the only reliable source of power in the country from the sounds of it. I suppose it's better to leave the entire country decimated without air conditioning or refrigeration or whatever else the power is doing to keep people alive over there.

We have to sell them cheap oil because 1) More people would die without it. 2) More citizens would be in revolt against the US since they were used to cheap oil under Saddam. 3) Haliburton got a sweet contract to truck it all in (since assigned to a lower bidder when word got out and people complained about giving no-bid contracts to the VP's former employer).
posted by willnot at 5:07 PM on June 7, 2004

Oh, its okay so long as Halliburton's making some duckets off of the deal. Phew, I was worried that they were going to go under without those no-bid contracts.

So what's happening to all of that luscious Iraqi oil then?
posted by fenriq at 5:12 PM on June 7, 2004

So what's happening to all of that luscious Iraqi oil then?

Iraq's current oil production capacity is something like half what it was two years ago. And I am sure they have contracts for what they can produce, which it behooves them to meet. Also, I'm not sure what Iraq's refining capacity is -- that could potentially be a bottleneck.
posted by kindall at 6:49 PM on June 7, 2004

And we're paying Halliburton how much per gallon for gas for all the jeeps and tanks and things that we're using?
posted by amberglow at 6:50 PM on June 7, 2004

ahhh...here it is: (and it's higher than the yahoo article says) The United States government is paying the Halliburton Company an average of $2.64 a gallon to import gasoline and other fuel to Iraq from Kuwait, more than twice what others are paying to truck in Kuwaiti fuel, government documents show.
posted by amberglow at 6:57 PM on June 7, 2004

Well. we are paying about $7 a gallon in the UK

Similar prices here in Korea. Americans need to be paying much more for their gasoline. 'course that'd funnel more of their temp-job dollars into Saudi pockets (do they have pockets in their traditional dress?), and that'd be bad, right?
posted by stavrosthewonderchicken at 9:15 PM on June 7, 2004