The price of gas reflects elements of its distribution, consumption and source. The Figure shows the price of gas, in units of 1990 dollars, from 1950 to the present. In it is a tale or world instability and global economies. In 1950, the US produced 50% of the world's oil supply. It got this production out of approximately 600 thousand individual oil wells . Between 1950 and 1970 the price of oil fluctuated around some mean trend, based on market conditions. Around 1970, however, oil production in the Mideast began coming on line and US imports of foreign oil increased. As soon as our reliance on these imports grew to the point where we became dependent on it for private transportation, the Arab Oil Embargo was announced which caused the price of gas to quickly rise, lead to the exploitation of a limited oil reserve in Alaska, and ultimately lead to the Exxon Valdez disaster. Another disaster is the oil fires in Kuwait
The price of gas remained high until the early 80s when the Arab Oil Cartel begin to fall apart. After this collapse, the price of gas was as cheap as its ever been. In fact, during the late 80's, gasoline was 50% of its 1950 cost! The slight rise in the price of gas at the close of the 80's reflects increased taxation . As will be shown below, the price of gas and its low taxation rate are good examples of hiding the true cost of energy.
Since 1850, the energy consumption of the United States has risen by a factor of 33. On average, each individual consumes 3 times as much energy now as in 1850 and we have 11 times more individuals. Exponential Growth is a serious problem when integrated over long times. The Figure shows the historical rates of increase and decrease of several sources of energy production.