- The Washington Times - Sunday, September 4, 2005


Drivers aren’t the only ones feeling the pain of high pump prices and scattered fuel shortages. Independent gas stations are, too.

The stations, which rely on traffic from people filling up their tanks to drive sales in their stores, yesterday were counting their losses, which one industry group expected to be significant in the wake of Hurricane Katrina.

The marquee at a QuickTrip in Marietta, Ga., was blank, and the pumps stood idle as clerk Star Payne bemoaned the slow sales in the gas station’s convenience store.

“It will pick up when we get gas back,” she said, but quickly added, “We have not been given any time frame.”

The bulk of the nation’s 167,000 retail outlets that sell gasoline, including some that carry the names of big oil companies, are independently owned and operated. They rely on store sales to generate profits and generally receive only pennies on the dollar from gas sales, which are meant to drive traffic into their stores.

“This is a hundreds-of-billions-of-dollars industry, with the majority of profit coming from in-store sales,” said John Eichberger of the National Association of Convenience Stores, which represents companies that operate 70,000 outlets nationwide that sell gasoline. “A lot of retailers have lost money.”

Mr. Eichberger said it was too early to give an estimate of the losses, but he predicted it would be “significant.”

The hurricane damaged gas pipelines and refineries along the Gulf Coast and caused some supply and production disruptions. Panicked buying by motorists also has contributed to shortages at some stations in the South, along the East Coast and in the Midwest.

At a Low Cost station in Springfield, Ohio, Shahbaz Saeed ran out of gas and had to close all four pumps for a day just before the Labor Day weekend.

“We are back up now,” he said yesterday as he rang up one customer’s gas and sold two packages of cigarettes to another. Mr. Saeed said he wasn’t sure how much money he had lost during his day off the market. Low Cost was selling regular unleaded for $2.93 per gallon.

In Illinois, officials were trying to keep more gas stations from closing by relaxing some rules related to posting of prices, and station managers were trying to keep from losing more money by clamping down on gas theft.

The state’s Department of Agriculture said gas stations with older pumps that are incapable of computing and displaying prices higher than $2.99 per gallon will be allowed temporarily to post half-gallon prices.

“The alternative would be to shut those gas stations down until they were in compliance,” said Agriculture Director Chuck Hartke.

Jeff Napolilli, a cashier at the Westown Shell in Carbondale, Ill., said the fear of gas theft has caused his station to require customers to pay in advance.

In Tallahassee, Fla., many Circle K gas stations were out of gas yesterday and had been for several days. At a BP Amoco PLC station that did have gas, the price stood at $3.38 per gallon for regular.

Not all stations were hurting, though. Maurice Marcellus, a 23-year-old clerk, said the rising prices haven’t slowed store sales at the BP station where he works.

“People still have to go to work,” he said. “How are you going to go to work without gas?”

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