• When gas prices rise, people buy hybrids instead of gas-guzzling SUVs like this one.suv car cadillac escalade on the road image by alma_sacra from Fotolia.com
  
  Hybrid cars, which combine normal internal combustion engines with electrical motors, have been growing in popularity because they get better gas mileage and produce fewer greenhouse gases. Hybrid cars are still much more expensive on average than conventional cars. The demand on hybrid cars is dependent on several factors, gas prices being the most important.
  
  

Oil prices

• The oil market is volatile. Political instability in oil-producing regions can cause spikes in gasoline prices. As more and more of the world's oil reserves are extracted, it becomes more expensive to harvest what oil remains. Estimates of how much oil remains vary widely, but regardless, oil prices are unlikely to ever fall back to the low levels of previous decades. When gas prices are low, sales of SUVs and other inefficient vehicles increase. When gas prices are high, sales of hybrids and cars with good mileage increase.
  
  

Taxes and subsidies

• Subsidies to the oil industry result in lower gas prices, which reduce demand for hybrids. Taxes on the oil industry, as well as the gas tax itself, raise gas prices and increase demand for hybrids. Between 2002 and 2008, the oil industry received $72 billion in tax breaks.
  
  

Alternatives

• The demand for any product is influenced by the prices and availability of alternative, or replacement products. If the industry released several new non-hybrids with high gas mileage, or lowered the price of SUVs, there would be a reduced demand for hybrids. Currently, hydrogen cars and fully electric cars are too expensive or impractical to offer much competition for hybrids. This may change in the near future, with more fully electric vehicles promised by auto-makers such as Ford over the next few years. Hydrogen cars are limited by the number of hydrogen fueling station (California has the most with 13 in the whole state), but an increase in government subsidies or the development of a cheaper fuel cell car could change all that.
  
  

Environmental Awareness

• As awareness of global warming increases, the demand for hybrid cars increases as well. Hybrid sales saw a boost after the release of Al Gore's "The Inconvenient Truth." They are also higher among people with college educations, though this correlation could also be due to the higher incomes of these groups.