Who a BP boycott hits hardest
Consumer anger over BP's oil spill and rig disaster is being carried over into boycotts of BP stations.
But if you refuse to buy BP gas, will Tony Hayward, BP's embattled CEO, get your message? Possibly not.
The reason is that plenty of BP outlets, like all gas stations, are franchise arrangements owned by independent operators. If you shun their products, you will hurt the local owners, not the British energy giant.
In Hampton Roads, for instance, Miller Oil Co. owns 16 BP stations and supplies gas on a wholesale basis to 50 other small operators. The set-up takes the BP brand a few levels away from the parent firm.
Back in 1979, I did a newspaper story about the public outcry over high gasoline prices following the Iranian Revolution. I was friendly with the owners of an Exxon station in Virginia Beach, and they explained the micro-economics of their business to me. They went over their books and showed me that they didn't set the gas prices, although they had to factor in their needs by adding pennies to the higher prices per gallon to stay afloat.
In fact, Exxon was squeezing them on other costs, and they were having a hard time making whatever payments they needed to make to Exxon.The problem was exacerbated because customers were buying less of their gas because of the high prices.
Indeed, they probably had more friction with Exxon than with their outraged customers.Given the way BP has behaved in its deadly Texas City refinery blast in 2005 and with the Deepwater Horizon disaster, I would expect that tensions between independents and BP are even stronger.
| June 10, 2010; 12:35 PM ET
Categories: D.C., HotTopic, Maryland, Virginia, economy, energy, environment, traffic, transportation, wildlife
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