Little effect on car driving when fuel price is raised

Fuel prices are rising as a result of the drone attack that has knocked out large parts of Saudi Arabia's oil industry and the worrying event created in the market.

At the same time, the government announced last week that gasoline tax should be increased by SEK 0.15 per liter.

Thomas Sterner is professor of environmental economics at the University of Gothenburg. He says that gasoline prices affect car driving, but differ depending on time perspective.

- There is a short-term and a long-term reaction. For example, if we have a ten percent price increase, car driving would decrease by about one percent in one year, but by seven, eight percent in ten years, he says.

Thomas Sterner explains that if prices move up and down over shorter periods, it is difficult to see any clear effect.

- We are a little protected because we have policies that dampen our consumption. Had we not had the taxes we have in Europe, the effects of such a disruption of production would probably have been much sharper, says Thomas Sterner.

He says partly that the policy on fuel has already led us to change to other alternatives, such as electric cars, and partly that the increase in the price will be less percentage since the price is already high due to taxation.

- The effects are becoming more shocking in the US as you are larger consumers and the fuel is cheaper.

But the reason for the increased prices, namely the drone attacks on Saudi Arabia's oil facilities and the escalated conflict in the Middle East, sees Thomas Sterner as a significantly bigger problem.

- I think what's happening in Saudi Arabia is very alarming. If the damage to the country's oil production is permanent, one can fear that it will lead to a war in the Middle East and threaten world peace, says Thomas Sterner.