BP Franchisees Protest Prices

As many as 60 stations reportedly shutting off pumps over fuel distributor's prices

Jim Bursch, Senior Vice President, Group Publisher & Editorial Director, CSP

ROCKLAND, Mass. -- A BP franchisee in Rockland, Mass., said that nearly 60 BP gas stations are shutting off their gasoline pumps for three days in protest of high prices that he said they are being charged by a regional BP gasoline distributor, reported The Patriot Ledger.

Raymond Succar, owner of a BP station in Rockland, told the newspaper that he shut off his pumps on Monday morning and will keep them off through Wednesday. He added that nearly 60 other station owners in Massachusetts are participating in the protest.

He said they are frustrated by the [image-nocss] high fuel prices that East Providence, R.I.-based Green Valley Oil LLC is passing on to the independent station operators.

Succar said his price for regular, self-serve gasoline was $3.24 per gallon on Sunday, while the AAA-reported state average on Monday was $3.11 per gallon.

This is the latest salvo in an ongoing fight between Green Valley Oil--which signed a deal to distribute BP gasoline in the region in 2009 (click here for previous CSP Daily News coverage)--and some of the local BP franchisees, said the report.

Warren Kirshenbaum, an attorney hired to represent the station owners, told the Patriot Ledger in June that Green Valley Oil was "trying to manipulate the market."

In a May letter to Green Valley Oil obtained by the newspaper, Kirshenbaum accused the company and its partners of "price manipulation" that threatened to shut down his clients' stations. He said Green Valley was "protecting its own revenues" by requiring set monthly lease payments based on "pre-contractual volume estimates."

He added, "It may be greed. I don't know what their motivation is."

In a response to Kirshenbaum's letter obtained by the paper, Green Valley Oil denied that it had manipulated prices to force consumers into paying more at the pump. It stressed that gasoline prices are constantly in flux and vary from company to company.

"Contrary to the suggestion in your letter, Green Valley has no incentive to limit the sale of its gasoline at the retail level. As a distributor, Green Valley is in the business of selling gasoline and it has every incentive to sell more gasoline," it said.

In a statement cited by the paper, Green Valley Oil said the company values its relationship with its dealers, takes their concerns seriously and has worked to increased their profitability."We continue to be concerned about misinformation being disseminated and note that Mr. Succar's claim of a 'protest' involving 'other station owners' is wildly exaggerated," Green Valley Oil owner Oleg Aliferov told CSP Daily News.
BP spokesperson Scott Dean declined to comment specifically on the matter. He told CSP Daily News, "BP's jobbers, including Green Valley Oil, are independent distributors and set their own business practices and pricing. BP does not direct, control or set the price its independent distributors charge their customers for fuel or the price its independent distributors post as the retail price at stations."

Jim Bursch, CSP Business Media/Winsight By Jim Bursch, Senior Vice President, Group Publisher & Editorial Director, CSP
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