Page 2
ER
LOCAL
"The Kings Mountain Herald
Ca
Sntombar 17, 2008
Who's really fixing the price at the pumps?
eweaver@kingsmountainherald.com
Before Hurricane Ike's path of
destruction was officially
mapped, gas stations around
Kings Mountain were running
low and the price at the termi-
nals was running high.
Fourteen refineries in Texas
and Louisiana, with a total
operating capacity of 3.6 million
barrels per day, had ceased
operations a couple of weeks
ago. And when the oil stopped
flowing, the prices starting ris-
ing. Although a barrel of OPEC
crude oil was exchanging for
less than $100 on Thursday, gas
station owners were beginning
to witness prices of record
highs.
When the word about refiner-
ies shutting down reached the
ears of the motoring public,
many made a beeline to fill up,
forcing some stations to buy
more fuel at higher prices, some
to post 10-gallon limit signs for
all transactions and even others
to cover nozzles with out-of-
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order bags. Two station owners,
who agreed to speak only on
the condition of anonymity for
protection, had different opin-
ions on the matter.
Both of the owners receive a
daily fax from their distributors
detailing the price they would
have to pay for fuel supplies.
“Yesterday we got a thing that
says we were going to have to
pay $4.55/gallon,” one store
owner said on Thursday.
The cost of a barrel of oil had
lowered and so had the project-
ed cost of gasoline. He said that
he called his distributor and
questioned the price. “So then
they faxed us a corrected sheet,
which was less than $4 a gal-
lon,” he said, adding that they
told him it would probably be
two weeks before they could
bring the store any more sup-
plies.
After the refineries shut
down, the terminals, which sell
gasoline to the distributors,
who in turn sell the product to
gas stations, were limiting
tanker loads on Thursday. The
store owner said that he has the
option of only purchasing his
fuel from three or four local dis-
tributors, who he alleges work
together in controlling the price
at which they sell to station
owners.
“A few years ago we got
aggravated because our price
was always higher than every-
body else’s and then, when you
tried to get another gas compa-
ny, they wouldn't even talk to
you because they all work
together,” the owner said.
“Whatever they pay the termi-
nal, they tack on a percent-
age...I don’t know who deter-
mines the price at the terminal.
But from what I understand
(our distributor) gets from more
than one terminal.”
It was unknown at press time
how heavily supplied the local
bulk petroleum terminals were
before the major refineries shut
down in the Gulf. But the store
owner accused the terminals of
“sitting on their supplies” to
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raise the price until more sta-
tions ran out of gas. “Then you
can run it up to $4.50 a gallon
and they're going to pay it
because they’ve got to roll,” he
said. “It's gouging the pub-
lic...The day before they ship it,
(the price) goes up. The day
after they ship it, it goes right
back down. Now what does
that tell you...It's like the
mafia.”
The local distributors facing
this owner’s masked accusa-
tions are Petroleum World,
Royster Oil Co. and Ray
Thomas Petroleum.
Ray Thomas said that the
accusation of him working with
other distributors to set the
price of fuel sold to local sta-
tions is “absolutely incorrect.”
He said that when he started
his business back in 1994 he and
other local distributors were
faced with similar accusations.
“A federal grand jury was
accusing us of price fixing,” he
stated on Tuesday. “We make it
a point not to even talk to each
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He said that the similarity
they do share is that the three
companies “all market in the
same area.”
Thomas added that one of the
main reasons the prices have
increased is, “We're having to
put premium gasoline into reg-
ular tanks right now to keep
people rolling.”
“People were running out of
gas everywhere. Exxon Mobile
charged me $5.21/gallon (for)
over 12,000 gallons (on
Saturday),” he said. “We lost
over $1/gallon on that.”
When others were forced to
pay $4.29 at the pumps, he said,
that they had to pay $5.21 to
bring it to them. “The major oil
companies are making the big
bucks,” he added. “We're the
ones who bear the brunt of
everything as jobbers.”
Petroleum World and Royster
Oil could not be reached in time
for comment.
See GAS PRICES, Page 5
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