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With nationwide gas prices hitting an average of $3.80 per gallon this week, consumers are truly feeling the pain at the pump. And, as a result, they´re starting to fight back.
Several campaigns across the Internet and on social media platforms, especially Facebook, have recently popped up, asking consumers to organize for "National Gas Boycotts." The thinking behind these campaigns is that if a large number of participants skip buying gasoline for the day, demand will plummet and prices will follow in suit, just like we were taught in Economics 101.
The boycotts certainly aren´t new. In fact, there seem to be rumblings of mass protests every time a dramatic increase in gas prices occurs. Because gas prices have hit record highs for this time of year, we´re starting to see them surface again.
One popular status update and mass email has been urging people to recreate "history" by boycotting gas stations on April 15, 2011.
"GAS OUT APRIL 15, 2011. In April 1997, there was a ´gas out´ conducted nationwide in protest of gas prices. Gasoline prices dropped 30 cents a gallon overnight. On April 15th 2011, please do not go to a gas station in protest of high gas prices... Please re-post this to your status if you agree!"
On Facebook, the frequency of reposting has been increasing, according to All Facebook, meaning that the word is getting out and more and more people are signing up to skip the pump this Friday. And given the nature of social networks, awareness could still easily increase exponentially.
But even if every American that is on Facebook (51% of the population, aged 12 and up) signs up to boycott on April 15 and actually goes through with it, will it really make a difference? Will the evil oil companies really lose out on billions of dollars after one day of no sales like the calls to action promise?
In a word, no.
The fact is that what dictates the price of gasoline is far more complicated than the boycotts would have you believe. What you pay per gallon at your local gas station is based on a complex combination of what goes into finding and refining crude oil (transportation costs, exploration, profit, etc.), the operational costs of the gas station (which include marketing and profit) and, of course, state and federal taxes.
The perennial ups and downs that gas prices experience are mainly driven by the first part of that equation, which is why you see gas prices spike when natural disasters strike near refineries (Hurricane Katrina) or civil unrest threatens crude oil production (Middle East protests). Because of this, one day of low gasoline sales in the United States simply is not going to disrupt that equation in any significant way.
So while the thought of protesting high gas prices is a good one, we´ll have to look for a much stronger action to take than a one-day boycott. We certainly don´t want to discourage anyone from participating, of course, because the boycott can work as a symbolic gesture. If enough people stand up and protest perhaps our movers-and-shakers may become more and more motivated to look for the energy alternatives for which we are becoming increasingly desperate.
Until then, we recommend you numb the pain at the pump by driving slower, keeping your tires inflated and carpooling whenever possible.