You cannot buy one gallon of gasoline and pay with exact change

If you’re like me, you’ve always wondered why gasoline costs are an extra .009 cents per gallon.

Well now that I have people who enjoy reading my pontifications, I set out to find out the answer, and share it with you, because I know you are dying to know too.

So I put on my journalist hat (actually it’s a newsboy cap - a newsy) and I drove to my gas station where I generally buy my gas and lotto tickets to try and find out. Unfortunately, what I learned was that the guy didn’t speak enough English for us to discuss it intelligently. (I should have known, since I have to point my thumb up to fill up the tank.) While I thought we were friends, I guess between my poor hearing, his accent, and his limited amount of English, we really only communicate as well as I do with my 15 year old grand daughter).

Anyway, so I went inside to talk to the owner, but what I found out is that no one really knew who the owner is. (Uh oh- here we go again, just like banks and foreclosures).

BUT I was able to get the number of the supplier. So I called up the company that brings the gasoline to the station, and asked them why they charged an extra .9 cents per gallon. They hung up on me (again, just like banks and foreclosures).

I decided that the only way to go was to go ask one of the Big Oil Companies themselves. After a lot of work, I received an email from Chevron who explained that they don’t set the price, but the independent dealers themselves do.

So much for the horse’s mouth.

What I was able to find out was that it seems that in the 1920’s, some marketing genius discovered that people are more likely to buy something that ends in a 9 then in a 0. $1.29 9/10ths per gallon seems so much cheaper than $1.30, especially when the sign is seen from a distance. (Don’t we list houses at $299,000 rather than $300,000? and don’t cars cost $19,999 not $20,000).

So what does it all mean?

I went to the web site for the Energy Information Administration,
and I found out that in October 2008, we processed crude oil into 55.800,000 gallons of gasoline every day. Thus: 55,800,000 x 365 days in a year x .009 cents = $783,303,000.00. So the oil companies make an extra three quarters of a billion dollars a year by charging that extra 9/10ths of a penny per gallon.

Of course these days, ¾ of a Billion Dollars doesn’t sound like a lot of money, like it used to. When I was a kid, a Million dollars was a lot of money, and it was all about becoming a Millionaire. There was a show called the millionaire where the star gave away $1 Million dollars every week to a complete stranger, tax free, but they could never tell anyone where they got the money from. Today they toss around 100’s of Billions of Dollars’ like its nothing. Former Illinois Senator Everet Dirkson once said, when talking about the nations budget “…a billion here and a billion there…. pretty soon your talking about a lot of money.”

More and more I am hearing a new word in news reports- Trillion- I wonder how long before we have our first Trillionaire? (Wow- my spell check program doesn’t recognize trillionaire as a word, it has red-lined it as a mistake, but offers no suggestions for its correct spelling).

Anyway, speaking of gasoline, last summer, before I started Lasher’s List, I went to see David Rampulla, from ferry ads, another marketing genius. This was when gasoline was at $4.00 per gallon, and climbing. He offered me a bet that day that gas would go down to below $1.50 a gallon (although he really meant 1.49 9/10ths). I didn’t believe him, said that the price of gas would never come down below $3.00 but certainly, $2.50, so I agreed to the bet. (By the way, while I was there, he recommended that I offer my services to companies and offices on Staten Island, where I can come in and motivate and pump up the people. Anyone interested in hiring me?). Over the next months, we all know what happened to the price of gas. Where I buy my gas it went as low as $1.32 9/10ths per gallon before it started going up again last week. If you think you need advertising help, you might consider using David; I think he has a crystal ball. (David, I know I owe you the dollar I won’t charge you for the plug).

…………………………………to be continued