Commentary > Wastler's Wanderings
Gas addicts, unite!
All this panic about prices is ridiculous; we're hooked. Live with it or kick the habit.
May 18, 2004: 4:21 PM EDT

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NEW YORK (CNN/Money) - Memo to American public: Please stop getting silly about gas prices. They're high. Prices sometimes do that. You got two choices. Pay them or stop using gas.

Seems simple enough. But the thought of cutting down on gas is scary. C'mon America, let's have gasoline panic intervention.

First, admit it's not a crisis.

The fact is, oil and gas prices are nowhere near, relatively speaking, where they were back in the oil shocks of the last century. In 2002 dollars, a barrel of oil in 1980 (think Iran) would have cost $78. We're just above $41 now. In other words, we'd have to have $4-5 a gallon gas to have the same economic impact. Get the point?

On top of that, fuel efficiency in cars is better than it was during the 1970s and 1980s.

So sure, gas prices are high, but they don't pack the economic punch they used to.

Recognize you like being addicted to cars.

America is car dependent. Unfortunately, there are no signs we will break this habit.

Look at the AAA forecast for summer travel. A 3.4 percent increase, even with fuel concerns. And air fares are pretty cheap.

Just now we are getting the first signs that the appetite for huge, honkin' SUVs ... I'm talking the big boys here ... is beginning to ebb. Sales were off 15 percent in April, according to Autodata.

But those April sales weren't lost mind you, just delayed. Big SUV buyers are just postponing purchases by about 4.6 months, according to CNW Marketing Group. And only 17 percent of car buyers have decided on car models based on fuel considerations, according to Kelley Blue Book.

Consider this ... of 56 basic car characteristics consumers base buying decisions on, fuel efficiency is 44th.

Maybe a little gas guzzler hardship could change this perspective.

Know politicians will enable your addiction.

Public dissatisfaction and politics can be a powerful combination, especially in an election year. So it should be no surprise that various senators are calling for oil to get released from the strategic petroleum reserve.

Bad idea. The reserve is meant for national emergencies ... like wars and embargoes. Hey, the way things are going overseas, we may actually really need that oil one day.

Dipping into the reserve now just because prices are high is like raiding your 401k to cover your taste for steak and lobster. Try eating Kraft macaroni and cheese for awhile instead.

Don't fantasize that you can fix the problem.

Seen the nonsensical e-mail zipping around the Internet this week, calling for a gas boycott on May 19?

"It has been calculated that if everyone in the United States 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 which affects the bottom lines of the oil companies."

Wrong. Wrong. Wrong. The dollar figure comes out of thin air. A one-day boycott would simply shift purchases, not end them. And the gasoline inventory pipeline, already low, could certainly handle a one-day delay. (For a more detailed debunking, go to the anti-hoax Web site

Wastler's Wanderings
Oil and Gas

Nevertheless, people vent. And the Internet is a great vehicle for it.

"We understand that people are concerned by high prices," said a spokesman at the American Petroleum Institute. "The best way to get prices down is to increase supply."

Or to kick the habit and cut down demand. You know, car pools, mass transit, all that yucky plebeian, inconvenient stuff.

But it's so much easier to be addicted.  Top of page

Allen Wastler is Managing Editor of CNN/Money and a commentator on CNNfn.

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