All that’s changed now: the most hated company in the USA is now BP. Big Oil (or as they call it in Texas, “the awl bidness”) has never been a public favorite. Maybe it’s because few (if any) other industries post the price of their products on every street corner; a product that most people buy as regularly as any heroin addict buys that nickel bag. Maybe it’s that so many people are just a little ashamed of their gasoline addiction… Or maybe it’s just that so many people don’t really understand the oil business.
That last is probably why almost every time an oil company incurs public ire, somebody decides it’s time to boycott their brand of gasoline. The cries of “Boycott!” rang out in 1989 after the Exxon Valdez ran aground in Prince WIlliam Sound, Alaska. When gasoline prices topped $4.00 per gallon in 2008, the same folks suggested that we all “boycott big oil." Presumably everyone would buy gas from “little oil” – whoever that is - instead.
| The concept of a boycott – refusing to buy gasoline from service stations and convenience stores that sell BP’s brands (BP, Amoco, and AM-PM among them) – seems simple and direct. If enough people take their business elsewhere, BP’s sales will dry up and the company will pay for their various sins. That would work – if BP made their money off of selling gasoline. The central problem with the idea of punishing BP by buying gasoline from the Shell station across the street is that BP isn’t a gasoline company. It’s an OIL company: they make those “obscene” amounts of money by selling crude oil. A barrel of crude oil sells (today, at least) for somewhere around seventy dollars. BP – just like ExxonMobil, Shell, Total, ConocoPhillips, even Mom 'n' Pop Oil and Gas R Us – sells crude oil on the open market. The oil that BP sells arrives at a refinery in a pipe (not in a metal barrel) mixed with oil that’s of similar quality produced by other companies. That refinery might belong to BP – it also might belong to Marathon, Sun, or a local refiner like Lassus Brothers. |
Once refined into gasoline; diesel; heating oil; and feedstocks for a host of other products like plastics, pharmaceuticals, and makeup; the product made from BP’s oil go into tanker trucks and pipelines. Gasoline goes into pipelines that run from refineries to terminals scattered around the country. At those terminals, tank trucks from various companies fill up from huge storage tanks. The difference between companies is not where the oil that made the gasoline comes from, it’s in the chemical additives that are added to the gasoline after it leaves the terminal. That’s when Chevron adds “techroline” or Exxon adds a few drops of tiger.
It is impossible to track a gallon of gasoline back through the terminal and up the pipeline to the refinery and thence to the well from which the crude oil was pumped. A gallon of gas bought at your local RoadRunner or Chevron is exactly as likely to have come from a BP well as one bought at a BP-branded station.
BP’s largest cashflow from stations and C Stores bearing one of their brand names is franchise and liccensing fees: only about one in thirty stations is owned by the company's retail division. Those fees will stay the same whether a station is boycotted or not. BP’s real cash flow comes from selling crude oil, so as long as the demand for crude that’s been refined into gasoline remains the same, BP’s profits will be unaffected – because when you pull into a different station, you’re still buying gasoline refined from oil sold by BP!
 
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A boycott of all BP stations (and it’s a safe bet that most would-be boycotters don’t even know which brands BP licenses) will have a minimal effect on BP at best. A boycott would have a far greater effect on local small businesses. The vast majority of gas stations and convenience stores are franchises owned by a local businessman. The stations’ employees are locals, too: punishing these little guys just because their uniform shirt says “BP” is just ignorance of how the oil business works. |
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