[misterno]

We are talking about Turkey where average salary is like 1/4th of US's. People are paying $11.30/gal yet look at the consumption growth in oil.

Click on the link below then click on the chart below where it says "28 year history" next to consumption.

It is just unbelievable. I think substantial demand destruction in the US is still far away.

http://tonto.eia.doe.gov/country/countr ... fm?fips=TU

[mrobert]

Turkey (or other emerging economies), don't have the same amount of cars and fuel usage per capita, as the US.

Imagine that everyone has a car in the US and drives a certain amount of miles. There is little room left for growth (get more cars, and drive more).

This is not true in emerging markets. The only thing that high oil prices can do, is to change the amount of people that didn't own a car and will buy one. Still, there will be plenty to buy and drive one, regardless of prices.

[misterno]

Well, I am just amazed with the growth no matter what. Last time I was there, I was shocked to learn how little the cars were using gas. The engines are so small like average 1100 -1300cc yet they are powerful most with diesel and stick shift. I calculated their MPG to be around 40mpg which is really high. Also most cabs in major cities use LPG but of course that is a product from oil as well.

I just posted this to illsutrate how far the gas prices should go in the US to create a real panic and chaos. Until we reach to $12/gal in the US, we have so much to gain in efficiency. And this is doable. If Turkey can do it, US can do it easily.

The only problem is US govt should lower the crash test requirements, otherwise it will be impossible to introduce cars with small engines in the US.

[VMarcHart]

The US govt should lower the crash test requirements, otherwise it will be impossible to introduce cars with small engines in the US.

Let's hope not.

Otherwise, true, we have lots of fat to shed before we see a real calamity. However, perhaps Turkey is less dependent to daily gasoline consumption than we are, ie, suburban commutes, intense mechanized farming, countless varieties in supermarkets, etc. I know people that commute 50 miles per day. It cost them $10 per day to commute to and from work, or $200 per month. If gas triples, and everything goes with it, $600 per month will be a mouthful. (BTW, I don't pity them at all.)

[misterno]

You won't believe the size of suburban communities being built just outside of Istanbul. The population is closing in to 20MM.

BTW, this is happening with the most expensive gas in the world.

[burtonridr]

Another thing to think about is that Turkey probably doesnt export nearly the same amount of food the Us does.

Agriculture is a large player in our economy....

Do they make 1000cc 40mpg tractors in turkey?

[eastbay]

You won't believe the size of suburban communities being built just outside of Istanbul. The population is closing in to 20MM.

BTW, this is happening with the most expensive gas in the world.

That's a perfect case indicating why the energy service sector will keep moving upward. People will keep driving well past $5.00/gallon and well past $10.00/gallon. This crack fest still has legs.

[VMarcHart]

People will keep driving well past $5.00/gallon and well past $10.00/gallon.

True. Assuming in today's dollars, how much will a gallon of milk or a loaf of bread cost by then? Will the US be able to drive and eat? Will the US turn into a third world country economy?

[aahala2]

We are talking about Turkey where average salary is like 1/4th of US's. People are paying $11.30/gal yet look at the consumption growth in oil.

Click on the link below then click on the chart below where it says "28 year history" next to consumption.

It is just unbelievable. I think substantial demand destruction in the US is still far away.

I'm surprised that you're surprised. What has been the price
history in Turkey for oil products in real terms?

If one looks at the consumption chart, the growth rate appears
to have been a lot smaller than 10 years before, and the last few years
smaller still.

High or increasing prices does not necessarily mean less will
be sold, but rather less will be sold than IF prices had
been lower or more stable. We can only imagine what might
have occurred had prices been lower , but that's what we have
to compare the actual with.

[yesplease]

As others have mentioned, they see twice or more what the average US vehicle gets, and I think the average mileage per year is a lot lower too, which is probably an upside to having a decent rail network. I'm guessing gas would have to get to ~$20/gallon there before it hits Americans as hard as $5/gallon gas.

[yesplease]

Doh! The info's in the OPs link.
Per capita oil consumption in Turkey is ~675,000bpd with ~71,000,000 people, in America, ~20,700,000bpd with 300,000,000 people. So... 30 times more oil consumption, but only 4.2 times more people. Gasoline would have to be ~2.5 times what it is currently to impact the citizens of Turkey in the same way it impacts Americans.

[copious.abundance]

The chart being referred to actually shows almost no growth at all in oil consumption since 2000. Maybe it's around then that the price went way up.

[misterno]

The reason consumption is flat is because the cars are much lighter in Turkey more than ever before.

Second reason is a substantial amount of car owners modified their engines to LPG instead of gasoline. LPG is a little bit cheaper.

oh wait, the chart above refers to oil not gasoline. Himmm, I dunno what to say then.