Mar 312012

People are struggling to understand the current petrol buying pattern. There is a claim that it is the fault of Francis Maude, who spoke of filling up Jerry-cans. Others call it “insane” and “self-inflicted damage”. They are failing to see things from the drivers’ points of view.

My summary:

I saw unusual queues for petrol on Tuesday evening. Francis Maude’s infamous statement was published on Wednesday. It was not the cause of those queues, although it was probably the cause of some silly use of Jerry-cans. The current buying pattern did not need such a trigger; it was ready to happen.

The current buying pattern of trying to achieve a fuller tank before stations run out of petrol is typically sound logic. (But there is significant irrational individual behaviour). Most people are not self-inflicting wounds. They are reacting as best they can to seriously inconvenient events outside their own control.

One driver’s point of view

(For stylistic reasons I’ll use male pronouns).

Consider a driver who wants to use more petrol over the near future than he has in his tank. So in the near future he must buy more petrol.

Now assume this driver predicts the possibility that there will be a shortage of petrol in that near future. (For any reason whatsoever).

What should that driver do?

An obvious and sensible action is to buy that petrol as soon as possible. Any delay may make it harder, even impossible, to obtain the petrol.

This is what people have been doing. It is often called “panic buying”, but where is the panic in the above sequence? No! It is sensible, logical, reasonable behaviour.

What is the impact of that one driver’s action?

If only one driver behaves in this way, there will be no detectable impact on anyone else. This driver cannot plausibly be accused of “insane behaviour”, or “acting selfishly”.

If there is a shortage, the driver’s actions are vindicated. If there isn’t a shortage, the driver has simply bought some petrol he would have bought anyway, a few days early. He has “peace of mind” over those few days, so even this has a positive benefit. He did what he should have done.

What if all drivers do the same?

The above  driver cannot be blamed if everyone else does the same thing for the same reasons. He didn’t make them do so, and was powerless to stop them doing so. We simply have lots of drivers acting sensibly, and it is strange that people get irate about this!

If lots of drivers act like this, there will be those shortages. Every driver is therefore vindicated for the above reasons.

Every driver has behaved in a sensible, logical, reasonable way. No driver can plausibly be accused of “insane behaviour”, or “acting selfishly”, or “panic buying”. (There are drivers who behaved badly, but the shortages would have occurred without them).

No driver can be expected to avoid buying petrol as soon as possible! Why should that driver sacrifice his own travel arrangements for the sake of the others? (Remember, every driver is vindicated). And even if a driver does so, the effect of not buying a few litres won’t stop the shortage happening. It would be a futile gesture!

But there is no imminent strike!

So what? What has a strike got to do with it?

Drivers are reacting sensibly to the possibility of shortages for any reason whatsoever. The possibility that a shortage will be caused by other drivers is just as significant as the possibility of a strike. If you run out of petrol, does it matter whether it was because petrol didn’t get delivered or because another driver got there first?

Who is to blame for the shortages?

Is anyone to blame? People like to have someone to blame, but sometimes “shit happens”.

No individual driver caused the shortage. No individual statement from a minister or official caused it. It is a consequence of “system behaviour”, with the basis for the shortage built into an unstable system before there was ever a hint of a shortage.

Once the shortage occurs, it is too late to stop it without draconian measures such as rationing being imposed on drivers from local or national authorities. Only authorities with the ability to change the behaviour of most drivers, hence use of law or force, will be effective.

Two patterns of buying behaviour

Consider two patterns of buying behaviour: “complacent buying” and “resilient buying”.

Complacent buying

If drivers take it for granted that petrol will always be available within a few miles, then they are likely to drive around part or all of the time with tanks less than half full. The total fuel in the nation’s car tanks will be minimised. And if shortages don’t happen, this will not be a problem. But if there is a possibility of a shortage, this results in the sort of behaviour discussed above and seen recently.

If there were shortages on average at least once per year, people wouldn’t behave like this. But shortages typically occur only every few years, and drivers stop taking precautions. They perhaps save time and effort by doing so by not bothering to stop for petrol until the tank is nearly empty.

Resilient buying

If drivers are constantly reminded that shortages may occur, they are likely to drive around most of the time with tanks more than half full, and perhaps averaging three-quarters full. They don’t consume more petrol (except perhaps a little caused by the fact that their cars are a bit heavier). But the total extra fuel in the nation’s car tanks is much greater.

Many such drivers would have no need to react to the possibility of a shortage in the near future because they can manage until the shortage is over. Hence they will not (inadvertently) contribute to a shortage. So if most drivers buy resiliently there may not actually be a shortage!

Implications and lessons

In effect, the current shortages have been caused because lots of drivers are (perhaps temporarily) switching from “complacent” to “resilient” buying.

Unfortunately, this needs a much greater total amount of fuel in the nation’s car tanks, and that cannot be delivered in days. It needs a lot longer, perhaps weeks, to deliver. (But once it has been delivered the nation is more resilient to fuel disruptions and far less likely to have shortages caused by collective driver behaviour).

(If there are people to blame for the shortage, they are typically the drivers who were complacent in spite of their urgent need for petrol in the near future. And they are often the drivers who are blaming others for the shortage!)

The implication is that “complacency” is to blame, and “resilience” is a good target.
But I don’t know how to achieve and sustain this over a long period.

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