Gulf Oil Eyes ExxonMobil Stations

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Gulf Oil Eyes ExxonMobil Stations

BOSTON -- When Exxon Mobil Corp. recently decided to sell 820 service stations, distributors from around the country took notice with hopes of increasing respective market share.

Among those taking interest is Gulf Oil LP of Newton, which bought the delivery contracts for more than 500 company-owned and franchised Exxon stations in 2003 after they were divested following the merger of Exxon and Mobil, reported The Boston Globe.

Gulf would be interested in ExxonMobil's company-owned stations in the region, which operate under the Mobil flag, Gulf's chief executive, Joseph Petrowski, told The Boston Globe. "We have invested in the Gulf brand, and we want to extend it."

Gulf, a fuel wholesaler and New England's only major locally owned gasoline brand, switched 11 stations it operates on the Massachusetts Turnpike to Gulf from Exxon. Next year, it plans to switch another 158 Exxon-branded stations in New York and New England owned by its parent, Cumberland Farms of Canton, to Gulf, reported the paper. Gulf supplies gasoline to another 300 Exxon stations in the region. Gulf expects
about two-thirds of those stations to operate under the Gulf flag.

Currently Gulf supplies roughly 2,500 stations in the Northeast, approximately 10 percent of the market. About 2,000 operate under Gulf flags.

Gulf is but one example of an increasing trend where local distributors are playing a bigger role in retail gasoline operations. Oil companies are cutting retail losses by focusing on crude oil production.

Petrowski said that rising costs, such as credit card fees, and low profit margins have made it increasingly difficult for small station owners to operate independently as unbranded stations. According to the state Division of Standards, the number of stations licensed in Massachusetts, for example, declined to about 2,700 in 2007 from about 3,900 five years earlier.

With gas prices on the rise, Petrowski told the paper operators are focusing on convenience stores, repair services, or quick oil-change services to supplement earnings.

"For the average consumer there will be fewer gas stations, bigger gas stations and local people operating other businesses tied to them," he told the paper.