Business | Opinion
Global zerophobia has made a monster of $100 a barrel oil
What a difference a single dollar makes. As a matter of fact, almost like a mind-altering-shock wave, a global hysteria, a cry of the consumer to be heard around the deepest corners of the globe, in addition to being 'breaking news' to the hearts content for the glitzy-TV-media-machine.
- Naseem Javed, Special to Gulf News
- Published: 23:27 November 14, 2007
What a difference a single dollar makes. As a matter of fact, almost like a mind-altering-shock wave, a global hysteria, a cry of the consumer to be heard around the deepest corners of the globe, in addition to being 'breaking news' to the hearts content for the glitzy-TV-media-machine.
The current oil prices have been coasting around, give or take a few dollars less than $100 for a little while; it is only a matter of time before, sooner or later, when that one dollar addition becomes the anticipated reality.
Consumers all over the world have always found comfort in things that are often priced at the 99 cent range, regardless of whether it's a small item at $9.99 or $99,000 for a big ticket item. No wonder it's so common to see luxury penthouses are priced to sell at 19 million and mega planes being sold for 99 million.
The change from a nine to a zero seems to be where the secret lies. The fear of zeros has many a sociologist and psychologist puzzled for a long time. Studies have shown that people will take a slightly lesser product for $99 than an identical product with more features for $100.
Perhaps the one per cent of the additional cost isn't the issue, but rather the switch of the number from nine to zero is the real psychological fear factor.
The mind simply freezes, as it has to cross that upper threshold, it simply feels uncomfortable and rejects the notion. Is this what happened when we made the transition from 1999 into the year 2000? Wasn't the overly-blown hysteria over Y2K anything but a manifestation of this global zerophobia?
All over the globe and particularly for the media-enlightened-west, the $100 barrel price is not only a much of a bigger fear but also offers itself as a great punching bag, as the west routinely bundles most of its current economical and other wild problems and dumps them on the Middle East.
Big campaigns have been already arranged to tackle the $100 issue and all along, during the upward swing, in anticipation to such record breaking price tags, information is being released in a highly orchestrated way to ensure the steady justification of the prices.
Even more so, the slightest notion of disrupting anything in the Middle East is immediately linked to oil flow, as alerts go out at bullet speed, adjusting retail prices and hit the consumer hard, right in the pocket; where among other problems and fears, lurks the zerophobia monster. The poor consumers continue to curse in frustration, only to drive away on their never-ending roads to nowhere.
The branding and image marketing emulating from the oil retailers is singing a very different song while the oil producing countries are playing a different music both at serious odds.
The stories of endless and upward spirals have been planted for quite a while to soften the fears of consumers, and yet getting them to expect $100 as a new standard. After the $100 hoopla, consumers will continue to pay, obediently without question, until the price starts approaching the $110 threshold where another zero makes itself visible. What can we do about this?
We couldn't possibly eliminate zeros; after all, the number was originally invented by the same oil-producing Arabs.
Corporate communication, branding and global image positioning are huge challenges for countries wishing to lead and project fairness.
The oil prices may go up or down, but the globe's negative perception of Opec and various other oil producers created by mega oil companies is where the real battle lines are being drawn. Talk about fear, what will happen when it hits $200? Ouch.
The writer is an expert in corporate image and global cyber-branding.
Studies have shown that people will take a slightly lesser product for $99 than an identical product with more features for $100.
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