Question:

Boycotting the bigboys?

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I'm curious if we (Americans) were to stop buying fuel from the industry leader Exxon & Mobil what effect would that have on the market and would they be forced to lower their prices and would other companies be forced to follow their trend?

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2 ANSWERS


  1. If America stop buying oil, it would not have much effect as China and other countries would buy more.


  2. Nah, here's why.  There would be no incentive for Exxon competitors to drop their gas prices.  Why should they since demand for the competitors gas will increase.  

    Suppose you own a Shell station across the street from an Exxon station that is being boycotted.  Your business will increase, and as long as you are getting those extra customers, you will not cut your prices - until you start losing customers that is.  Eventually, as Exxon begins to lower their prices more and more to attract business, you will start to lose customers that will say, heck with the boycott, I'm going for the cheaper gas.  As the Exxon station gets more customers, they will also begin to raise their prices again.

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