Wednesday, April 19, 2006

Exxon Mobil boycott

I have a friend who dutifully forwards glurge to me every day. A week or two ago she sent me the ExxonMobil boycott chain mail in which recipients are asked to stop buying gas from Exxon Mobil gas stations and to instead patronize competing stations. The idea is that these stations will reduce their prices; we consumers then use the cheaper gas at XOM and boycott another set of gas stations. We game the "system" for our financial benefit.

I hit "Reply-All" and kindly explained why this scheme does not work. Tim Habb at the Environmental Economics blog does a better job than I at explaining why the boycott is pointless.

With oil and gasoline prices making the news again, politicians are grandstanding and demanding investigations. If you have a million gallons of gasoline on hand but Americans want to buy 1.2 million gallons, the price will rise until demand drops to one million gallons. Sure, oil companies are making record profits, but the only thing artificial price controls will do is artificially increase the demand. Because supply is not flexible, the increased demand will lead to shortages, gas lines and pain.

Which brings us back to a boycott. Not just of Exxon Mobil, but for all gas stations. Practicing restraint and getting by with less will result in reduced gasoline prices. Ride a bike to work and school the shopping, combine trips, use public transit, save energy in the home -- these are the patriotic actions that will truly work to help preserve our way of life.

Tim Habb article via The Oil Drum. Tags: peak+oil, gasoline, boycott, xom, economy, exxon

6 comments:

Roger said...

There's just one problem with your idea -- it makes too much sense!

Anonymous said...

I just got the chain letter and posted a blog entry about it this morning. I do recall someone saying on TV or radio that here in the Capital Region of NY State all the brands get their gas from the same source, so in this case, boycotting would be uneventful.

James T said...

Good advice. I have noticed that people don't think riding a bike to work is all that crazy these days.

Anonymous said...

Economists understand the intracicies of why a boycott won't work. I am not an economist so I can't touch on those. Even www.snopes.com has information debunking boycotts. Regardless, the vast majority of gas stations are franchised and independently owned. Boycotting those would hurt small business people. My mother is one of those people (she operates a few gas stations). I'd hate to think of America boycotting an innocent sweet old lady!

Adriel said...

Every 1% of Americans that commute by bike for 50% of their travel save 1.6 billion dollars in gasoline spending every year.

Some justifications here

Every person that says it cannot be done is not helping anything, just get on your bike more and let the car gather dust. It is an amazing sensation the first time you look at your car and realize it has been 3 days since you drove it.

a 10 mile bike ride takes a novice an hour, and 40 minutes for an experienced cyclist, (30 minutes if you get really good and do not have a lot of hills to climb).

How far is your commute? Less than 10 miles? Do not judge by minutes, use a mapping service, like maps.google.com

I think you would be surprised.

Oh and as far as the speed of the mighty car? Here in Austin where we have a lot of highways I get a whopping 28mph average speed. In london the average speed in a car is 7 or 8mph. Similar for New York City. Every time you sit at a stoplight you average 0mph, and if school has taught us anything, it is that when you average a 0 and a 100 you get a failing grade. 0's REALLY hurt, the higher the number it averages against, the more it hurts.

If we reduce demand we will affect the price, gasoline hopefully will never get really cheap again and hopefully will get prohibitive to buy, maybe then we will see more bicycles and other forms of transportation on the road, I think the golf cart would make a great EV. It goes about as fast as a bicycle. You just need a few extra batteries to extend the trip.

Adriel said...

Oh and ever since I decided to replace 50% of my car miles by bike miles I have been saving about $100-200/mo

So it saves a LOT of money.