9
The J J
CXXVIII Edition March 2010
Gasoline Retailers Association of Florida
214 Stevenage Drive Longwood, Florida 32779
http://www.flagas.com
e mail
407-774-9700 SSDA/NCPR-AT
Pat Moricca President Member Service Station Dealers of America
INDEPENDENT BRANDS
VISIT OUR WEB SITE FOR THE LATEST GASOLINE
INDUSTRY INFORMATION AND BENEFITS
www.flagas.com
Gasoline Retailers Association of Florida is a non-profit association representing Independent Gasoline Retailers, Convenience Stores, Gasoline Service Stations, Repair Shops, Tire Retailers, Truck Stops and Associates throughout Florida. Our goal is to improve the interests of these independent businesses and the motoring public. Cooperation with insurance companies provides benefits for our members. These benefits include money-saving programs for group health, workers' compensation, casualty and property and gasoline tank liability insurance. Benefits also include financing to purchase your gasoline station property and much more.
The problems facing our industry today affect every dealer, no matter how large or small. And, since no one individual could possibly begin to solve these problems alone, it remains that each should join in a collective effort to protect his/her business investment.
Join the Gasoline Retailers Association of Florida and help in the fight to keep the
Motor Fuel Marketing Practices Act of Florida (Below Cost) law.
Make an important investment in your business future for less than $1 a day.
Notice
The closing of many gasoline stations due to the underground gasoline tank upgrade deadline December 31, 2009 has caused a reduction of income because of non-renewals as many gasoline retailers shut their pumps or closed their stations. Loss of membership is why the Gasoline Retailers Association of Florida is in a real tight fiscal year. Membership is the backbone of any association and any help for new membership will be appreciated.
Any eligible businessman or woman, who joins, and participates in a few on-going
programs will find that his/her savings in overhead costs will more than justify the dues that each member pays. Meadowbrook Workers Compensation dividend was 7% for 2009 on paid premiums.
MEMBERSHIP DOES NOT COST, IT PAYS
Florida Department of Health in partnership with the Florida Department of Agriculture, the Gasoline Retailers Association of Florida and the Florida Petroleum Marketers Association, are a part of a statewide public awareness initiative called “H1N1 | Spread the Word, Not the Flu”.
‘Gasoline Station Owners and Operators’ will receive stickers by mail to spread the word about H1N1 and display the stickers on each gasoline pump in places where customers are most likely to see them and convenience stores doors to help inform customers of how they can help prevent the spread of the H1N1 virus.
I’m sure ‘Gasoline Station Owners and Operators’ through your participation, we can help Floridians “Spread the Word, Not the Flu.”
For more information on H1N1 prevention, please visit www.MyFluSafety.com or call the flu hotline toll free at
1-877-352-3581.
SPREAD THE WORD TO END THE R-WORD
You may not realize how damaging the R-word can be. You are marginalizing and insulting millions of people with “Disabilities” and their families.
Take a pledge and put an end to the R-word www.r-word.org
LEGISLATIVE ALERT
The Florida legislative session starts March 3rd and we need your help in sending mail, e mail and telephone calls to you State Senator and Representative to not sweep the Inland Protection Trust Fund (IPTF). It is vital for Florida to have funds available for cleanup program of contaminated sites. The legislature acknowledged that there would once again be a significant shortfall in the state budget. If Florida did not have enough money coming in to cover basic services (all of which they have vices already cut) they would not raise taxes or increase fees so the only place the money can come from is trust funds. They reinforced the fact that education, health care, prisons and other vital state services would be funded. Then they would be looking to sweep trust fund funds in an effort to balance the budget.
Join the Gasoline Retailers Association of Florida and help Keep Below Cost law
“Lifeline of the Gasoline Industry, the Independent Gasoline Dealer.”
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San Ramon, Calif. -- Chevron Corp. saw earnings of $3.07 billion during the fourth quarter 2009, a decrease from the $4.90 billion earned in the year-go period. The full year net profit was $10.48 billion.
New York -- Exxon Mobil the world's largest publicly traded oil company reported earnings of $6.05 billion for the final three months of 2009. That compares with $7.82 billion. The full year net profit was $19.3 billion.
Who's Cooking Oil Prices?
The major oil companies all made less profit in 2009, but mostly because they could barely make a billion on refining and selling gasoline and diesel fuel, with demand running from down to stagnant. Yet they made plenty of billions on drilling and selling oil, which has more than doubled in price from around $30 a barrel (42 gallons) at the end of 2008 to around $75 a barrel 2-3-10. Yet global oil consumption was also down in 2009 from 2008, according to the U.S. Energy Information Administration. Does this make any sense at all?
Oil prices are still driven by speculative commodity markets, which are far more linked to stock markets than to actual demand. The weak U.S. dollar can't begin to account for the price increase since December 2008, especially since oil companies can't even sell all that they produce. Gasoline prices at least respond to markets being awash in unsold gasoline. Oil prices rise on the mere hope that demand might return next year, or the year after. Dollars that might be invested in jobs or new businesses end up in the commodity markets.
What other product has doubled in price in this dismal recession; at a fairly distant second are prescription drugs.
Government had removed any semblance of control from energy and commodity markets and turned them into a casino. But the oil companies didn't complain, and they are now ferociously opposing efforts to regulate the speculative markets that killed the economy. The American Petroleum Institute is demanding that commodity trading details stay secret from regulators and the public, with no limits. It still argues that free markets will somehow "self-regulate," despite the tsunami of loss they created last year.
There's a huge separation between what's really going on (fundamentals), and what people think or hope might happen (speculation). It would easily seem that speculation (paper trading without intention of taking delivery) is still driving up oil prices.
Gasoline Prices!
Sometimes I wonder if the oil companies realize the consumers are angry and won’t take it anymore. The first week of February saw crude oil spike to $77 a barrel from $72 on Monday only to retreat to $73 a barrel on Friday. At the same time; wholesale gasoline spiked 9 cents a gallon and then retreated 7 cents. It’s one of many times that the up and down of crude oil and wholesale gasoline prices. Speculation by traders who are just placing bets, not buying or selling oil.
A combination of the economy, jobless workers and conservation are big factors to the lower demand in the retail gasoline industry. Keep sending the message to the oil companies and OPEC, CONSERVE. The only message they understand is the Bottom Line.
Gas Retailers Buzzing in Beehive State
Say refineries holding back supplies in advance of maintenance shutdown!
Salt Lake City -- Gasoline retailers say they are feeling tighter supplies and higher prices as several of Utah's oil refineries hold back supplies in anticipation of shutting down operations for maintenance in March, according to an Associated Press report.
San Antonio, Texas-based Tesoro Corp., which operates Utah's largest refinery, played down the impact of the shutdown, saying it comes every year. The company said its North Salt refinery will shut down from March 5 to April 2. "These are routine events, but are planned well in advance, so we intend to meet all of our supply obligations," Tesoro spokesperson Lynn D. Westfall said.
Utah has five oil refineries concentrated along a belt just north of Salt Lake City. The state often enjoys low gasoline prices, said AP, because it is not economical for the refineries to ship fuel outside the Intermountain Region. That could change, however, with the completion of a petroleum products pipeline to the Las Vegas area. The project is under review by the U.S. Bureau of Land Management.
Silver Eagle's shutdown in November was overshadowed by problems at Wyoming refineries that also produce some fuel for Utah, said Lee Peacock, president of the Utah Petroleum Association. "Bottom line is that there has been some constraint of supply along the Wasatch Front due to refinery issues that has had some impact on price," he told the news agency.
Utah started out the winter with gasoline prices that were below the national average, he added. "Right now, I can only hope our prices come down," said John Hill, director of Utah Petroleum Marketers Retailers Association. "Several of the major producers in Utah are holding back product in anticipation of shutting down for maintenance."
That means gasoline retailers can get their tanks only partly filled, AP said, and they run out of fuel sooner.
Dismal demand, increasing inventories equals... higher prices?
U.S. gasoline demand at 16-month low, MasterCard says!
New York -- U.S. gasoline demand plunged to the lowest level in 16 months last week as record winter snowstorms kept drivers off the roads from Texas to New England, said Bloomberg, citing MasterCard Inc...
Motorists bought an average 8.84 million barrels of gasoline a day in the week ended February 12, MasterCard, the second-biggest credit-card company, said in its report. Consumption was the lowest since Oct. 10, 2008, when supplies were limited by two Gulf Coast hurricanes and the U.S. economy was spiraling into the worst recession since the 1930s.
"It's a combination of short-term and long-term factors" reducing demand, Sander Cohan, an analyst with Energy Security Analysis Inc., Wakefield, Mass., told the news agency. "Major snowstorms cutting off a part of the country that typically doesn't have snow is a major driver. This is typically the low point for gasoline demand. And, while we're coming out of an economic rut, we're not out of the woods yet," he said.
The Central Atlantic region, which includes New York and Pennsylvania, "suffered the largest and most noticeable week-over-week decrease" in demand with a decline of 16%, Michael McNamara, vice president of research and analysis for MasterCard Advisors SpendingPulse, said in a statement.
Gasoline use fell in New England, in the Midwest, on the West Coast and on the Gulf Coast. The only gain was in the Lower Atlantic region, where demand rose. The report from Purchase, New York-based MasterCard is assembled by MasterCard Advisors, the company's consulting arm.
If demand is down; why is crude oil high? The Commodities Exchange! On 2-24-10 crude oil closed at $80 a barrel.
Gas Tax Could Put Naperville Gas Retailers Out of Business
The Illinois city is considering a nickel per gallon tax to fill the budget gap!
Naperville, Ill. – Currently, residents of Naperville pay a 2-cent per gallon tax to the city, but that might rise to a nickel if the City Council approves the increase. The additional three pennies has city gasoline station owners fearing for their livelihoods, the Naperville Sun reports.
The council would use the additional funds from the increase to fund road maintenance costs, which have taken a hit with the city’s budget woes. Local retailers counter that such an increase will directly impact their slim profit margins.
“Five cents per gallon, that’s all (the profit made on gasoline sales),” said Gautam Patel, who owns a BP station. But he adds that the profit is not money in the bank; rather, it’s used to pay for overhead expenses, such as payroll and utilities.
“You are not taxing the oil companies or anybody like that. It is strictly to the operators,” said Patel.
Naperville Mayor A. George Pradel says it’s “a fair tax,” because the funds generated flow directly back to the roads.
Cities keep shooting themselves in the foot; because volume will drop and create less revenue.
U.S. Shedding Gas Guzzling Reputation?
The American consumption of gasoline has dropped for the past two years and experts do not expect a return to the highs of 2007.
Kansas City, Mo. – Three years ago, Americans consumed more gasoline than ever, and used more gasoline than any other nation, McClatchy Newspapers reports. It looked like the U.S. appetite for gasoline would continue to grow forever.
But in 2007, gasoline consumption started dropping, due to the recession and higher pump prices. Even when the economy recovers, Americans might not return to the gasoline consumption of the past for three reasons.
First, new standards for cars and light trucks and SUVs mean U.S. vehicles will be more fuel-efficient than ever. Second, the number of U.S. cars, after rising for the past three decades, will probably plateau. Third, alternative fuels are increasing enough to meet increased fuel demands.
The Energy Information Administration forecasted that 2007 was the peak year for U.S. gasoline demand. Even as far out as 2035, drivers are predicted to consume less fuel than they currently do.
“We’re on a slow but inexorable path away from petroleum,” said James Williams, an analyst with WTRG Economics.
“Motor vehicle gasoline demand is down, is headed down and is going to continue to head down,” said ExxonMobil Corp. CEO Rex Tillerson during a recent speech.
The declining use has repercussions for the oil industry, whose refineries currently only run at 78.5 percent of their capacity. Some oil companies, such as Valero Energy, are purchasing ethanol plants instead of refineries.
However, one thing that might throw the predictions off is how fast consumers will embrace alternative fuel and more fuel-efficient cars.
DOE Report shows increases in oil, gasoline inventories
After a two day snow hiatus, the Department of Energy finally released its report that continues to highlight poor demand and increasing inventories in the United States.
For the week ending February 5, oil inventories showed a healthy 2.4 million barrel increase in oil, bringing the total amount to 331.4 million barrels. Gasoline inventories also posted a rise of 2.3 million barrels to 230.4 million barrels.
Refining operations in the Midwest added another 700,000 barrels of motor gasoline to inventories there, pushing wholesale costs in that region lower as supply remains well above healthy.