What if we use some unusual approach to figure out inflation
Looking at historical data of oil commodity prices and gasoline prices got simple idea: could it be used to measure inflation? Of course there are multiple factors those impact ratio between those including EV becoming more popular but we’ll try to compare numbers. Since both of those price indicators have periods of high volatility we decide to take annual average price into account. Using finder as a data source following is the analysis.
Year | Agerage Gas Price | Average Crude Price | % change gas | % change Crude | Gas vs Oil change | Yearly average inflation rate |
2017 | 2.56 | 50.8 | 0 | 0 | 0 | 2.13 |
2018 | 2.73 | 65.23 | 6.64 | 28.41 | 4.28 | 2.44 |
2019 | 2.64 | 56.99 | -3.3 | -12.63 | 3.83 | 1.81 |
2020 | 2.19 | 39.68 | -17.05 | -30.37 | 1.78 | 1.25 |
2021 | 3.03 | 68.17 | 38.36 | 71.8 | 1.87 | 4.69 |
2022 | 3.98 | 94.53 | 31.35 | 38.67 | 1.23 | 8.02 |
2023 | 3.54 | 77.64 | -11.06 | -17.87 | 1.62 | 4.13 |
2024 | 3.27 | 78.33 | -7.63 | 0.89 | -0.12 | 3.15 |
from 2017 | 27.73 | 54.19 | 1.95 | approx 28 |
From data above it looks like there is no correlation of oil vs gas price growth with actual inflation metrics. It is interesting that for the period of time we selected gasoline price increase match inflation indicator very closely, but that probably coincidence and not valid assumption for many other periods. We will definitely spend time researching this topic more and share our findings in the future posts