Next time you pull up to a gas station and curse your near $100 gas tank fill-up, remember one thing: the business selling it to you may hurting more than you are. BusinessWeek:
Plenty of filling stations have already gone under. Last year, 3,184 of the nation's 164,292 gasoline stations closed their doors and went out of business...
Take Eranell Miller. He has owned a filling station and repair shop in Baldwin, Pa., just outside Pittsburgh, for 31 years. But lately, he has been losing money on every gallon of gas he sells. Some weeks, he can't come up with enough cash to fill his tanks and has run out of fuel. "If it gets worse I'll close my pumps down and just rely on my garage," Miller says. "I don't want to go bankrupt."...
He buys his gasoline for $4.04 a gallon from a local distributor and charges $4.09 a gallon....Miller says the credit-card fees now add up to an average of about 5¢ a gallon at his store. That means, including shipping costs and overhead, he loses money selling gasoline.
Why the pinch? Because if station's add an appropriate markup to $4.04 wholesale gas, consumers won't touch it. The same problem is squeezing margins at the refiners.
How does this affect Exxon Mobil (XOM) and their several thousand gas stations? Not at all, they're getting out of the gas station business. The little guy just can't win.
See Also:
Even Iran President Now Jawboning Oil Prices Down (XOM)
Here It Is--The First Major Call For $250 Oil (XOM)
