Getting Pumped

Paying a price for gas


in Archive


Gas prices, you’ve no doubt noticed, are hitting record levels again, and thus consumer irrationality is hitting record levels again, too. In a survey commissioned by the National Association of Convenience Stores (NACS), 26 percent of respondents said they’d drive 10 minutes out of their way to save three cents per gallon.


As the NACS notes, such a trip is more likely to increase your costs than it is to save you money. A 10-minute detour theoretically results in a 20-minute round trip. At an average speed of 45 mph, the trip would cover 15 miles. If your car gets 30 miles to the gallon, you have to burn half a gallon of gas to reach the station with the cheaper prices. At $4 a gallon, that’s a cost of $2. To make such a trip worth your while (without factoring in the value of your time or the additional wear and tear on your vehicle), you’d need a fuel tank capable of holding 67 gallons. At a savings of three cents a gallon, that 67-gallon tank would cost $2.01 less to fill up at the cheap station versus the more expensive station. This means that after subtracting the cost of the extra fuel it necessitations, your excursion would save you a penny!

Granted, every penny counts in these difficult times. And 67-gallon fuel tanks do exist. What this survey response illustrates most vividly, however, are two central tenets of American life. The first is that we love to drive – so much so that we’ll happily inconvenience ourselves in the pursuit of trivial savings (which, as the numbers above illustrate, aren’t even likely to pan out). The second is that as much as we love to drive, we absolutely hate to pay for gas. In May 2004, when gas reached $2 a gallon for the first time, we complained that it was too expensive. In September 2005, when gas topped $3 a gallon for the first time, we complained that it was too expensive. If it ever drops to these levels again, our former judgments will likely reassert themselves. Whatever the current price of gas is, it’s too expensive.

In part, we feel this way because the fueling industry does it job so well. In 1905, the Automobile Gasoline Company opened the first filling station in St. Louis, Missouri. By 1994, America had 202,800 places where drivers could fill their tanks. The number has come down since then — currently, the U.S. has 159,006 retail fueling sites — but consider how easy it is to buy gas as compared to any other product. You can buy it around the clock (the first 24-hour stations started opening in the late 1920s). You don’t need any cash on hand (60 to 70 percent of gasoline purchases are financed by credit or debit cards). You can conduct the transaction unilaterally (the first self-serve station debuted in 1947 in Los Angeles; Mobil introduced the first pay-at-the-pump stations in 1986). You can buy it in whatever particular amount suits your needs best.

The fueling industry clearly has worked very hard to make purchasing gasoline an easy, thoughtless, almost involuntary act, akin to breathing; but helping these efforts is the fact that gas prices are so visible. Huge signs on thousands of street corners tell you what the price of unleaded. A person who, say, drinks milk every day and never drives a car still has more exposure to gas prices than milk prices. In addition, while buying gas is extremely convenient, the actual transaction is unusually lengthy – and unsparingly graphic in the way it updates your imminent bill a penny at a time, with the pennies quickly morphing into dollars, and the dollars weighing more and more heavily on your consciousness. In California, where gas routinely goes for $4.50 or more these days, a trip to the pump means watching $70 slip through your fingers in three minutes or so. Unless you’re extremely wealthy or a problem gambler, paying for gas is the fastest way you routinely part with your money.

And for what, really? “It’s hard for people to stop using fuel,” Fred Rozell, director of retail pricing for the Oil Price Information Service recently told MSN Money. In truth, it’s easier than ever to stop using fuel, or at least to use less of it, and that’s precisely what makes high gas prices so maddening. Cars used to be the easiest, most effective way to expand our reach in the world. When TV gave us only three shows to watch, a car could take you to the cineplex. When you wanted to get the best deal on a stereo, a car could take you to the Circuit City sale three towns over. Now, we’ve got the Internet for all that.

And even if you insist on working from work because you don’t want to give up business-class Internet access, you can bike to your office, you can carpool, you can buy a more fuel-efficient car. Indeed, while the gas that cost 36 cents per gallon in 1970 would only cost $2 per gallon today, the average fuel economy for cars in that era was approximately 13.5 miles per gallon. In contrast, a 2011 Ford Fiesta gets 28 miles per gallon in the city and 37 miles per gallon on the highway — so until gas prices top $4 per gallon, Fiesta drivers are actually paying less per mile for gas than the drivers of the 1970s did. And they’re not paying a premium to achieve such efficiencies — the Fiesta starts at $13,320 (that’s just $2312.72 in 1970 dollars).

Try giving up food for a week, and you’d be pretty cranky come Sunday. Try giving up the Internet for a week, and you’d surely go crazy. Try giving up gas for a week, and you’d do comparatively well. So why should we have to pay so dearly for that which is no longer nearly as crucial to our lives as it once was? It’s this paradox that has us driving miles out of our way just to “save” three cents a gallon. We can live without gas now, but that’s what makes it so hard to live without. • 11 May 2011