By Mick Gregory
What the mainstream news either can’t or will not provide. The cost of this oil industry report is $150. That’s about how much a reporter costs a day following Hillary and Obama around.
Where are the followup stories on Citgo? Why not report on why 7-Eleven, Circle K and Petro Express dropped Citgo? Have they lost 3,000 or is it closer to 5,000 locations?
More than 90 brands were ranked in this year’s Brand Power rankings including Mobil, Exxon, Stewarts, Marathon Ashland, Citgo, Cenex, Sunoco, Rotten Robbie, BJ’s, USA Petroleum, Safeway, Phillips 66, Sinclair, Kum & Go, Aloha, RaceTrac, Admiral, Home Depot, Caseys, Speedway, Kwik Trip, PDQ, Irving, Tesoro, Rutters, Gas America, Gate, Mapco, Getty, Gulf, Circle K, Weigel and more.
The Oil Price Information Service (OPIS), the leading authority on wholesale and retail gas prices in the U.S., has put together the most comprehensive scorecard on the entire retail petroleum landscape. The OPIS Retail Year in Review and 2007 Profit Outlook is a must-have 125 page almanac for anyone involved in the downstream petroleum industry.
The report includes the annual OPIS Brand Power results, a ranking system based on how much of a premium one brand is able to extract against its direct competition at the pump.
On a national basis Chevron proved to be king for the third straight year. The average Chevron station was able to charge 2.15cts/gal more than its competition. Shell was second followed by Lukoil, BP, Texaco, Fina, Mobil, Exxon, 76 and Pure.
At the opposite end of the spectrum was Arco which priced its pumps nearly 10cts/gal below its competitors. The Arco discount was more substantial than Costco, Sam’s and BJ’s, the three largest wholesale clubs in the country. Most of Arco’s business is company operated or dealer tankwagon, but if measured against local racks, Arco sites fetched very low implied margins.
On a regional basis, top honors continued to go to major flags except one region.
New England: Texaco was the most powerful player with the average station pricing 3.1cts/gal above its competitors. Shell was next followed by Mobil, Exxon and Sunoco.
Hess was the most aggressive in the region, even more aggressive than supermarket chain Stop & Shop.
Mid-Atlantic: Shell, Mobil, Lukoil, and Exxon were in the top four, while Wawa, Xtra Fuel, Delta Sonic, Royal Farms and Kroger were in the bottom five.
Southeast: Chevron was also a regional winner in the Southeast. The more aggressive stations in the region included Flying J, Costco, Liberty , Sam’s and Sheetz which recently opened some sites in North Carolina.
Great Lakes : It was independent brands in this region that took the top 2 spots. Gas City and Fast Stop were best in the region which were comprised of Wisconsin, Michigan, Illinois, Indiana and Ohio. Flying J, Meijer, Wal-Mart, Murphy USA, Thornton Oil, and Kroger were ranked as some of the chains with the lowest pump prices.
Midwest : BP took the top spot in the Midwest which also saw Valero and Fina crack the Top five. The top 5 most aggressive brands included Murphy USA, Quik Trip, Kwik Shop, Mirastar and 7-Eleven.
Southwest: The 76 flag was tops in the Southwest. The most aggressive supermarket in the region was Kroger followed by Albertsons, HEB and Safeway. The data also indicates that Costco priced more aggressively than Sam’s by about 3 cts/gal.
Rockies: Chevron once again obtained a regional championship and Conoco cracked a regional top-five for the first time this year. Sam’s Costco, Mirastar, King Soopers, Flying J, and Maverik were the most aggressive sites in the region.
West Coast: Texaco was number one in the West Coast followed by Chevron. Costco and Arco were the two cheapest pricing brands on the Pacific.
In addition, the report takes an in-depth look at profit margins on a national, regional and market-by-market basis. It reveals the six annual trends in the market, (the winter high, winter sell-off, Petronoia rally, Petronoia ebb-tide, demand/storm rally and the autumnal collapse) and examines how each market in the eight regions of the country reacted to those trends.
It is clear to industry analysts that Citgo is in its last months as a brand. Not even Joe Kennedy shilling for Hugo Chavez’ brand, can help stem the market losses.
Why don’t your major newspaper business sections cover this subject?