Mukesh the Delhi auto-rickshaw driver scrapes by as it is.
Karina's family of fish sellers in Jakarta is paying a budget-straining 12 cents a gallon for gas.
And now, an oil price rise.
Developing nations, particularly in Asia, take the brunt of oil price shocks. The latest rise isn't likely to completely undo the Asian economic recovery. But it has left many governments - and consumers - scrambling to adjust to the new reality.
India, for example, imports 70 percent of its oil, and heavily subsidizes the local pump. Each dollar rise in a barrel of crude costs the Indian government $400 million in hard currency. Those costs are projected to rise from about $10 billion to as high as $21 billion this year - a figure Indian analysts say matches spending on education and defense.
As a result, last week Indian officials announced a 10 percent cutback on new government jobs, and a year moratorium on filling vacant jobs - though it also delayed passing along higher prices to consumers, because of concerns about the possibility of strikes similar to those that European truckers mounted this summer.
"For us, this comes like a bolt out of the blue," says C.D. Wadva of the Center for Policy Research in New Delhi. "We were hoping to tread the path of incremental growth, and we never planned for any big shocks."
Even as recovery from Asia's economic meltdown of 1997 is still taking hold, rising oil prices are acting as a wet blanket of uncertainty across the region.
Few analysts think oil fluctuations will spark a crisis of the kind that blindsided the global economy just three years ago. Even though oil-dependent Asia leads the world in growth of demand, the region is performing strongly enough so that an oil hike by itself can't flatten its economies, and some experts warn against fearful jitters.
Yet prices that jumped from $13 to more than $30 a barrel, plus weak currencies, high deficits, and, in recent weeks, large market swings, are dampening optimism for a sharply higher Asian economic upturn.
"We fantasized during the 1990s about a Pacific or Asian century," says Cha Soiw Yue, an economist at Singapore University. "But after the crisis ..., we don't speak with that kind of confidence."
Last month the IMF's World Economic Outlook warned of a possible oil-related slowdown in the global economy. Asian states depend heavily on exports, and lower demand by belt-tightening Americans for electronics, auto parts, and other manufactured goods that Asia excels in could constrict growth.
Higher costs for crude threaten to exacerbate weaknesses peculiar to different Asian tigers - lack of investment in Indonesia due to instability, Thailand's struggle with a huge overcapacity and bad loans, and South Korea's 100 percent dependency on imported oil, to name a few.
Combined, such factors affect investor and local consumer confidence. In Southeast Asia, for example, direct investment remains down from a peak of $21 billion in 1997 to $13 billion today, said a report by the secretary general of the Association of Southeast Asian Nations (ASEAN), leaked recently to reporters.
"It's still not fashionable to invest here in the way we saw in the late 1980s and early '90s," says one European economist in Bangkok. "The oil price rise won't help."
Says Dr. Wadva in Delhi, "We have gotten used to $12 a barrel, and no one has been thinking conservation.... The OPEC rise has been developing for years, and it took 20 days for the G-7 nations to respond. This worries private investors."
In 1998, world oil prices dropped to about $12 to $13 a barrel, partly to address the Asian crisis. But in adjusted terms, this year's increases are higher than the spike in 1990 during the Gulf War, the last sharp oil "price shock," to use the industry phrase.
Even in oil exporting states like Malaysia and Indonesia, higher oil prices may be a mixed blessing. Oil accounts for only 5 percent of Malaysia's exports, and the nation has a regressive subsidy of $1 billion to lower prices. An oil hike will affect other Malaysian businesses as well as regional traders; how much is the question. This week the government in Kuala Lumpur announced a domestic oil price rise.
In Indonesia, which on Sunday began to make good on promises to the IMF to hike oil prices, revenues may double - though the government will have to pay more to keep the huge subsidy at the local pump intact. Indonesian subsidies amount to $5 billion, more than it spends on welfare. Indonesia's deficit now runs at about 90 percent of all goods and services sold. Some experts say Indonesian oil revenues may give international lenders a reason to push for economic reforms the country has long avoided. Experts say the problem is not that Indonesia can't reform, but that political will is lacking, and a corrupt bureaucracy is unwilling.
On Sept. 21, in fact, World Bank president James Wolfensohn singled out Asian countries for "corruption and cronyism" that is providing "the seeds for the next crisis." Corruption has blocked needed reforms in South Korea, Indonesia, and Thailand, Mr. Wolfensohn said, arguing that the economic recovery of the past two years has "masked" the problem.
GDP growth rates for Hong Kong, South Korea, China, Malaysia, Singapore, Taiwan, Thailand, India, Indonesia, and the Philippines were strong last year, and higher in the first part of this year, despite the early oil hikes.
Some analysts feel that Asia should simply "ride out" the crisis, and that excessive worry over oil is worse than higher prices themselves.
"Oil prices will only seriously hurt Asia if policy makers are stampeded by the strong dollar into interest rate hikes and fiscal caution to stabilize local currencies and counter oil based inflation," wrote economist Philip Bowring last week in the International Herald Tribune.
(c) Copyright 2000. The Christian Science Publishing Society