by frog
I got a chain email this morning urging me to boycott Mobil in an effort to bring petrol prices down. It’s very similar to other chain emails which have circulated in the past. Here’s a sample:
This makes MUCH MORE SENSE than the “don’t buy gas on a certain day” campaign that was going around last April or May! The oil companies just laughed at that because they knew we wouldn’t continue to “hurt” ourselves by refusing to buy gas. It was more of an inconvenience to us than it was a problem for them. BUT, whoever thought of this idea, has come up with a plan that can really work. Please read on and join with us!
By now you’re probably thinking fuel priced at about $1.00 is super cheap. Me too! It is currently $1.55 Ltr for regular unleaded. Now that the oil companies and the OPEC nations have conditioned us to think that the cost of a gallon of gas is CHEAP at $1.00, we need to take aggressive action to teach them that BUYERS control the marketplace. not sellers. With the price of gasoline going up more each day, we consumers need to take action. The only way we are going to see the price of gas come down is if we hit someone in the pocketbook by not purchasing their gas! And, we can do that WITHOUT hurting ourselves.
How? Since we all rely on our cars, we can’t just stop buying gas. But we CAN have an impact on gas prices if we all act together to force a price war.
Here’s the idea: For the rest of this year, DON’T purchase ANY gasoline from the biggest company MOBIL. If they are not selling any gas, they will be inclined to reduce their prices. If they reduce their prices, the other companies will have to follow suit. But to have an impact, we need to reach literally millions of Mobil gas buyers. It’s really simple to do!
Aside from the fact that the prices it quotes are already well out of date, it’s unfortunately a misguided idea which is unlikely to work and which ignores the real problem. There’s no point in demanding that oil companies provide us with an endless supply of cheap petrol, as this is obviously unsustainable. It’s frankly greedy to expect that we’re entitled to cheap petrol however we please. We should be focussed on demand and supply, for sure, but on reducing long term demand, not removing short term demand from one company.
A site dedicated to refuting Urban Legends has a page dedicated to this very email (in the US context) explaining what’s wrong with the idea (hat tip to Nandor’s EA Alison Coleman for that). And here’s what Jeanette had to say in response to a similar email last year:
Kia ora
Many people have passed on the suggestion about boycotting BP and Mobil in an effort to bring the price of petrol down.
I agree that the oil companies are profiteering. You can see that from their annual profits, and this behaviour should be controlled. However, I believe that even if such a boycott were successful (and I have my doubts) it would only serve to drive the price down for a short time.
The underlying reason for high oil prices is physical limits. Barry talks of $1.35 a litre – what about $3? With world oil supplies close to their peak production and world demand for oil still rising, the price will just continue to increase even if oil company profits are controlled. When supply peaks it soon starts to fall and that is permanent.
Recently the world’s biggest oil supplier, Saudi Arabia admitted that OPEC has lost control of oil prices because the Saudis are already pumping as fast as they can. Crude oil hit a record US$56.46 a barrel, while demand soars. Just eight years ago crude oil was $10 a barrel.
Oil companies are, of course, self-serving – they don’t want their share price to fall. A year or two ago Shell was convicted in the US of seriously overstating its reserves in order to bolster its share price, and heavily fined.
We have got used to thinking oil will be there forever. It won’t. We need to be concentrating our efforts on how to decrease our oil dependency instead of how to make our oil dependency more affordable (see our campaign here).
Regards
Jeanette Fitzsimons
Published in Economy, Work, & Welfare | Environment & Resource Management by frog on Fri, April 28th, 2006
Tags: environment
on the trolls and those who are unable to keep on topic
Jeanette is right about the root problem, but the profiteering is a problem in itself.. consumers are way too passive in the face of profiteering, I have no problem with encouraging them to attempt to take back what little power they can. It might even flow through into a more active involvement in politics..
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As this email originated in the US, and has merely changed the prices to reflect (historic)
NZ levels, I thought it would be good to link back to The Oil Drum and Environmental Economics, where the whole topic has been discussed in some detail.
Simple Answer = DRIVE LESS
A boycott won’t work. What happens at all the other stations? Assume Mobil has 20% market share and assume EVERYONE boycotts Mobil, that means demand at other retailers will increase by 20%. When demand increases, prices rise. So the effect of the boycott is to increase prices at all other outlets…Bugger !
Lucky Old Mobil – their price hasn’t increased so the boycott makes their price look cheap. Of course, given the oligopoly that operates in NZ, Mobil would put their prices up somewhat and still benefit because not everyone will boycott them.
Of course petrol is petrol – so it doesn’t matter where it comes from. If Mobil had an excess and the other 3 majors had a shortage, Mobil would be busy filling the tanks of the others – and hence selling more at a higher price.
The only way consumers can force lower prices is through the market mechanisms of supply and demand. As Jeanette said, we need to consume less. I.e. use the car less, use a smaller car, use a more efficient car, etc etc.
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I strongly urge readers to check out the Latest editorial at “The Oil Drum” about
“The Politics of Oil: The Discourse Must Change”
http://www.theoildrum.com/story/2006/4/26/121441/891
While it is directed at US politicians, we can all gain something from this insigtful commentary.
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i recently traveled to new plymouth from auckland
the cheapest you could get anywhere was mobil which was 7 cents cheaper than anywhere else
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The email says: “Since we all rely on our cars, we can’t just stop buying gas.”
The funny thing is that (in Wellington at least) people have done just that, which is why buses and trains have had large increases in patronage. Of course, said buses and trains are now bursting at the seams because for years, various levels of government have refused to invest in public transport capacity. Why? Because “we all rely on our cars” of course!
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I’ve just come across an article in Guardian Unlimited, which in my view, gives a better reason to avoid buying products from Mobil. Of all the IOCs, they have been particularly active in funding and pedalling junk science to undermine any action to mitigate climate change.
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