Please buy gas!

This e-mail reprinted below, which is circulating incredibly widely, may represent a new low in economic thinking. It declares September 1st “No Gas Day.” I got three copies today. Still, I wasn’t going to blog about it, until I went on the web-search engine technorati and saw that all sorts of bloggers seem to be embracing the concept.

So here is the original e-mail:

IT HAS BEEN CALCULATED THAT IF EVERYONE IN THE UNITED STATES AND CANADA DID NOT PURCHASE A DROP OF GASOLINE FOR ONE DAY AND ALL AT THE SAME TIME, THE OIL COMPANIES WOULD CHOKE ON THEIR STOCKPILES.

AT THE SAME TIME IT WOULD HIT THE ENTIRE INDUSTRY WITH A NET LOSS OF OVER 4.6 BILLION DOLLARS WHICH AFFECTS THE BOTTOM LINES OF THE OIL COMPANIES.

THEREFORE SEPTEMBER 1ST HAS BEEN FORMALLY DECLARED “STICK IT TO THEM DAY” AND THE PEOPLE OF THESE TWO NATIONS SHOULD NOT BUY A SINGLE DROP OF GASOLINE THAT DAY.

THE ONLY WAY THIS CAN BE DONE IS IF YOU FORWARD THIS

E-MAIL TO AS MANY PEOPLE AS YOU CAN AND AS QUICKLY AS YOU CAN TO GET THE WORD OUT.

WAITING ON THE GOVERNMENT TO STEP IN AND CONTROL THE PRICES IS NOT GOING TO HAPPEN. WHAT HAPPENED TO THE REDUCTION AND CONTROL IN PRICES THAT THE ARAB NATIONS PROMISED TWO WEEKS AGO?

REMEMBER ONE THING, NOT ONLY IS THE PRICE OF GASOLINE GOING UP BUT AT THE SAME TIME AIRLINES ARE FORCED TO RAISE THEIR PRICES, TRUCKING COMPANIES ARE FORCED TO RAISE THEIR PRICES WHICH EFFECTS PRICES ON EVERYTHING THAT IS SHIPPED. THINGS LIKE FOOD, CLOTHING, BUILDING MATERIALS, MEDICAL SUPPLIES ETC. WHO PAYS IN THE END? WE DO!

WE CAN MAKE A DIFFERENCE. IF THEY DON’T GET THE MESSAGE AFTER ONE DAY, WE WILL DO IT AGAIN AND AGAIN.

SO DO YOUR PART AND SPREAD THE WORD. FORWARD THIS

EMAIL TO EVERYONE YOU KNOW. MARK YOUR CALENDARS AND MAKE SEPTEMBER 1ST A DAY THAT THE CITIZENS OF THE UNITED STATES AND CANADA SAY “ENOUGH IS ENOUGH”

Thanks and have a wonderful day :o}

Here is a (no doubt) partial list of totally idiotic mistakes in that e-mail:

1) If nobody buys gas today, but everybody drives the same amount, then it just means that we either had to buy more gas in anticipation of not buying any on September 1, or that we will buy more a few days later. So even if you believed this would take a $4.6 billion dollar bite out of the oil companies that day, consumers would hand it right back over. If this was “No Starbucks coffee day” it might have some chance of mattering, because people buy and drink Starbucks coffee the same day, so a foregone cup of coffee today may never be consumed. But this is not true of gasoline, especially if no one is being asked to reduce gas consumption. All you will get is longer lines at the pump the day after.

2) A one day total boycott of gas would not reduce oil company bottom lines by anything like $4.6 billion, even if it was accompanied by a one day moratorium on all gasoline use. Americans consume about 9 million barrels of gas a day. There are about 42 gallons in a barrel, so that equals 378 million gallons of gas sold a day in United States, or about one gallon per person. Toss in another 10% for Canada. At $3 a gallon, that is about $1.2 billion in revenues. Profit as a share of revenues in this industry is probably 5% or less, so the bottom line impact is a max of $60 million…about 1/100th of the stated number. And from point (1) above, even this is a gross exaggeration of the true impact.

3) One day of no purchasing of gasoline would certainly not cause the oil industry to choke on their stockpiles. Gasoline inventories in the US are typically about 200 million barrels, but right now they are on the low side — a big part of the reason why gas prices are high. 9 million extra barrels would create no problems whatsoever for stockpiles.

So everyone, please buy gas on September 1st.

And if you ever have the bright idea to circulate an email like this, at least tell people not to use gas, rather than not to buy gas.