I got an email forwarded to me today suggesting that we all quit buying gas from Exxon Mobil in an attempt to “show them that the consumer sets the price, not the seller” and get the price of gas back down to $2 a gallon. Of course the way to this Nirvana is, as always, to forward the email to everyone you know… sigh.
Let’s assume for a moment that for some reason a few million people decide they will no longer buy gas from Exxon or Mobil (though it’s really not likely to begin with). That means they’re all buying from, say, BP or Phillips or wherever. Great, so their stations now either run out of gasoline and diesel, or they start buying more… from Exxon Mobil, or Exxon Mobil’s suppliers, since they now have a surplus. I’m betting the price would go up a bit.
Oil (and gasoline) is fungible; it doesn’t matter WHERE you buy it, it all comes from basically the same supply. It’s a near perfect example of basic, elementary supply and demand from first-year economics. It matters not one bit whose retail outlet you buy from; if demand remains the same, prices follow supply — which is controlled by people who just plain DO NOT LIKE US. The only way to reduce the price of gasoline is to drastically increase the supply or drastically reduce demand. If the same few million people dumped their SUVs and pickups and started driving hybrids or riding to work on bikes or scooters or public transportation, we’d see a more substantial hit to gas prices.
If we as a nation had put some serious money and effort into developing alternate energy technologies over the past couple of decades or even into better developing our own oil exploration, extraction and refining, rather than pouring billions into trying to secure our decidedly unfriendly foreign oil sources, we’d still have $2 a gallon gas (and not care, since we wouldn’t be using it for much anyway). There are two reasons we are paying over $3 a gallon for gas: we’re stupid (or do a good simulation of being stupid), and our politicians are whores who think no further ahead than the next morning’s newspaper and the next election. It’s not their fault; we get the government we deserve because we make stupid choices.
Just imagine the impact that would be felt from, say, 10 or 20 million electric vehicles, charged overnight from wind, solar and nuclear power. Hell, I could put all the gas I needed in my mower and scooter for $2 a gallon then. But, see, we don’t HAVE 10 million electric vehicles, nor do we have enough solar and nuclear power to provide their power if we did, because we seem to have learned NOTHING from the last time we went through this in the early 70s.