Selective gasoline company boycotts? Good or bad idea?

Great Debates
1

I just got an email from someone who is proposing that consumers should fight back against high gasoline prices by selectively boycotting gas companies one at a time.

The email said that there was a plan a few weks ago in which people were urged not to buy gas for one or two days. The oil companies just laughed at this, because they knew we would all come back when we needed to fill our tanks.

What this email is proposing is that we start with the biggest oil company and stop buying from them until their price come down, say by about 5%. Then the other companies would have to follow suit. In other words, you start the spiral pshing prices down instead of up.

Does this sound like a crackpot scheme or would something like this work?

The email I got was Canadian and it mentioned PetroCanada and Imperial Oil (Esso) as the first targets. Since there are no PetroCanada stations in the US I guess it would work differently. But wold it work at all? Your opinions please?

2

I started a selective oil company boycott that’s working fantastically. I’ve selected boycotting all of them, and stopped buying gasoline; I take the trolley every day now.

3

I forgot to mention that this email said that this kind of concerted, selective boycott is possible today thanks to the Internet. If each person emails the message to 10 others, etc., that we all boycott company X on May XX until their prices come down by 5%, then if you do the math, within a day or two you would have millions of people all putting pressure on one company. I repeat, is this too crazy to be possible, or is it just crazy enough to work?

4

Bad idea.

5

It won’t work.

The only boycott response that will actually work is to buy less gasoline, period. Not on one day, not from one company, but now and for the rest of your life.

Of course, if you stop buying gasoline then you’ll also stop caring what the price of gasoline is.

If people stop buying gasoline from one particular chain, then that chain can just sell their surplus gasoline to other chains. The boycotted chain makes less profit, the other chains make more profit.

Why can’t people understand that gasoline prices aren’t a matter of some gigantic conspiracy, but are the result of supply and demand decisions made by billions of people all over the globe? If gasoline is getting too expensive, that’s a signal to stop buying so much.

Oh, one more thing. A joke that’s been going around recently:

Three oil company executives are sitting in jail, comparing war stories. One of them says, “I’m in here for charging more than my competitors. They got me for price gouging and profiteering. I got 5 years.” The second chimes in. “Oh yeah? Well, I’m in here for charging less than my competitors. They got me for unfair competition and dumping. Now I’m in here for 10 years.” The third looks over and says, “Wow, that’s all? I’m in here for charging the same amount as my competitors. That’s 20 years for monopolistic price-fixing.”

6

What Lemur866 said. Use less gasoline, and convince everyone you know to do likewise. I say that even though I’m an employee of an oil field service company, and even though that would eventually tend to reduce exploratory drilling for oil, which is how the company I work makes the bulk of its money.

Nobody I know in the industry laughs at people struggling to pay for gasoline. I don’t get the stuff for free just because I work for a service company, you know, nor do I get a wage adjustment every time the price of gasoline goes up. I suppose you can find a few bloated plutocrats in the industry who resemble the guy in the Monopoly game, but most of the rest of us are just working stiffs like (I presume) your fine self.

7

The problem with your idea is the premise that we are paying high gas prices. We are paying higher prices than before but nothing in comparison to world market prices. Maybe you are not aware of it but we are now importing gasoline. This is a relatively new event in the history of energy consumption and doesn’t bode well for the future. The good side of this is that we already had a conduit for processed oil so Katrina wasn’t the energy crisis it could have been when refineries were shut down. If you want the price of gasoline to go down then write your representatives and ask for the following:
-an immediate increase in oil drilling in the United States
-reduction of environmental rules for diesel or research into cleaner diesel engines.
-the construction of more refineries.
-research on the gasification of coal (a purer form of diesel fuel)
-research on shale oil and sand oil extraction
-reduction of EPA mandated fuel blends to eliminate seasonal changeovers
-reduce or streamline environmental restrictions for hydro-electric, nuclear, solar, and wind powered generators.
-accelerate the newly mandated fleet mileage requirements.
-research on alternate fuels.
-research and incentives for hybrids. (battery research alone would drive down the price of hybrids)

There is no silver bullet solution to this problem. China and India’s growth and subsequent increase in oil consumption will continue to raise prices. We need to increase production and decrease consumption. For this to happen public support is needed to change energy policy. The more we rely on our own resources the less money leaves our economy, allowing for continued low interest rates. Lower interest rates make it easier to invest in new technology, which in turn can lower consumption.

8

Somebody put up flyers around my school telling everyone to boycott the gas stations every Wednesday. Like it’s some magnificent blow to their profits that all their money will come in on Tuesday. Both ideas are ridiculous.

9

Well, I think it’s a GREAT idea, in many ways, but it won’t have much effect on the price of gas though. :slight_smile:

10

I’ve gotten several emails suggesting that Exxon/Mobil is the one to boycott. Problem: in my area there are no Exxon/Mobil stations. So, which station should I boycott instead? Wait–that wouldn’t do any good, would it.

I would walk/bicycle or, in dire cases take the bus. If the round trip is under three miles I figure I should walk, unless I’m in a hurry. (Yeah, I realize, then I should walk faster.)

11

Words to live by. How about an internet campaign to get people to carpool, or drive 55 instead of 70 on the highway? That won’t work, because nobody in this country actually wants to curb their use of anything, at any time, for any reason. We want to consume, consume, consume. So, the best idea these jokers can come up with is “buy as much as you want, but buy it THIS way, and it’ll all be better.”

Drop our overall gasoline consumption by 10% and I’d bet the price would plummet.

12

It’s the same idea behind pyramid schemes. Those don’t work either.

13

I got that one too and was tempted to forward it on just not because I think it will (or should) accomplish anything in regards to high gas prices but because I am participating in a boycott of Exxon/Mobil for other reasons (mainly that they are a particularly bad actor on global warming…funding lots of the right-wing groups who are distorting the state of the science).

You might be tempted to say, “Baahh…All oil companies are probably equally bad!” However, that is definitely not true anymore. BP and Shell have both explicitly accepted the scientific concerns about climate change and BP has led the way in demonstrating how Kyoto-sized cuts in their own emissions can be made for negative cost (i.e., they are saving money). I wish this region had BP/Amoco stations around so I could frequent them.

I am not sure exactly where all the other oil companies stand but Exxon/Mobil seems to be singularly bad in funding the front groups. IMHO, they are not worthy of my business.

14

Can you explain how your boycott on Exxon/Mobil has any effect beyond the level of your local gas stations?

15

The problem with the email (which I’ve received as well… or, at least a variant) is that it is based upon any number of faulty assumptions, which a well-researched half-hour can easily dismiss. The email has some plan by an ex-oil industry “executive”, that, properly implemented, could drive the price of gas down to $1.30.

First there’s the assumption that XOM (that’s Exxon-Mobil, btw) is a price-maker for either crude oil or gasoline - it is not. XOM provides less than 20% of the nations gasoline supply and less than 3% of the total global oil flows. While the financials look huge, as a percentage of the size of the global oil industry, Exxon is peanuts. Better to go after Aramco, a $1.6 trillion operation (5 times the size of Exxon) that merely controls the entire output of Saudi Arabia.

Secondly, I have serious doubts it was written by any executive worth the title. Note that they focus not a whit on the financials but spend their mathematical wizardry explaining the exponential power of SPAM! I wonder if I can get him to sign me a contract where I get paid 2 cents for the first chess square, .04 for the second, .08 for the fourth… :cool:

Thirdly, let’s look at the $1.30 figure. How, exactly, with $70/barrel oil are we going to get a gallon of gas to $1.30? Modern refining methods extract appx 19 gallons of gasoline per 42 gallon barrel of crude oil. At $70/barrel, that comes to 1.66/gallon of extracted product... .36/gallon over the price objective!

Add distribution (that gas has to get from the refinery to your car somehow), sales, marketing, etc, and all of a sudden you’re looking at a gallon of gasoline that costs well over $2.00/gallon to produce and bring to your gas tank.

Fourthly, if you’re complaining about high gas prices, do note that over 25% of an oil company’s revenues go towards taxes. In XOM’s case, over $95 billion of their $358 billion in 2005 revenues went to taxes - essentially, 1/4 of the company operates as a tax collector for various international (and US) governments. When you shell out (no pun intended) 3.00 for gas, do note that .78 of that is a tax hit (not just the amount on the sticker on the gas pump).

Why don’t these people boycott the government? :wink:

Cite: http://yahoo.brand.edgar-online.com/fetchFilingFrameset.aspx?dcn=0000950134-06-005663&Type=HTML Section 22: Summary Statement of Income

16

There may be hope, actually. The bellweather I use is a guy named Steve who lives down the road from me. Steve owns a Ford diesel pickup with which he pulls his 18-foot Bayliner and his 24-foot Red Dale to area lakes and camping areas. Sometimes he pulls a trailer loaded with “4-wheelers” up to the mountains to tear up the terrain. Steve’s refrain has always been that the bastards who own the gas are getting rich off of hard-working guys like him, forcing him (his union, actually) to demand more and more and more money from his employer, and pay more and more and more for his vehicles with all the fuel conservation stuff on 'em. Then one day last month the Denver Post ran an article that detailed the rise of gasoline prices over the past decade. I clipped it and gave it to Steve.

Yesterday, I saw Steve drive by on his way home from work – in a little 1980 Dodge four-popper. I drove down to his place and we chatted. He’s selling the boat outright and downsizing the camper for this summer. “The Chinese are buyin’ up all the gas,” he said. “And I ain’t payin’ a hunnerd dollars a day to go boatin’!”

I’m hopeful.

17

Assuming this is addressed to my hijack (and thus is not asking to explain how it would affect gas prices which is not my concern): Well, obviously individual action alone almost never is enough to make a noticeable difference. It is only when multiplied by lots of people that it becomes important. I actually started my own personal boycott of Exxon/Mobil several years ago but am glad that there is now an official (if still relatively unheard of) campaign.

Of course, the same argument about individual action can be made in many instances. We’ve had threads around election time of the sort: “Why does it matter whether or not I vote?” And, of course, one could ask the same question in regards to conserving energy…Why should I conserve when my personal contribution to global warming is miniscule on the level of the gigatons of carbon we add to the atmosphere each year!

Some things just have to be done with a sort of existential philosophy in mind…I.e., you behave in a way that may not make much of a difference in and of itself but reflects what you think is important and could really make a big difference if others followed your example.

18

Given that Exxon/Mobil can sell gas to any station, how can you organize an effective boycott that won’t just hurt gas station owners?

19

This argument is a pretty clear failure to understand market forces. It will probably have no effect at all. If anything, it will slightly increase the price of gas.

If gas weren’t fungible, it might be the case that boycotting one company would cause their prices to fall. As has been explained, though, that company will happily sell the excess gas to other stations. It’s not like you can look at an individual gallon of gas and check for a label the way you could with, say, Nike products.

However, even if that were the case, there is no reason for other companies to lower their prices. They would actually raise them. Boycotting one company without changing consumption will just increase the demand for the other companies. Ergo, gas goes up.

The claimed “price spiral” won’t work because there’s no pressure on the other companies to lower prices as long as the boycott lasts. Why would a station lower their prices to compete with a station that no one is going to? And if they do start losing customers, then the “boycott” didn’t work very well, now, did it?

20

Well, I am a little confused about what you are saying here. Where I live, I assume that the Hess gas stations get their gas from Hess, the Exxon and Mobil ones from Exxon/Mobil and so on. I suppose there might be a few unbranded stations around and I don’t know if they buy from the big names or not.

As for hurting gas station owners, hopefully the pressure will make station owners decide they would prefer to be associated with, and buying their gas from, a less irresponsible corporate citizen.