Exxon Mobil Corp. said Thursday it’s getting out of the retail gasoline business, following other major oil companies who’ve been selling their low-margin stations to gasoline distributors.
Motorists, however, will continue to see Exxon’s Tiger-themed stations and Mobil outlets in their neighborhoods. Already, about 75 percent of Exxon Mobil’s roughly 12,000 stations in the U.S. are owned by branded distributors, who buy Exxon Mobil products and pay to use the name.
Irving-based Exxon, the world’s biggest publicly traded oil company, said it now plans to sell to distributors its remaining 820 company-owned stations and another 1,400 outlets operated by dealers. Exxon Mobil didn’t disclose financial details but said the sales will take place over a “multiyear period.”
Texas has the most company-owned retail locations with about 190. Florida is next with 170.
“As the highly competitive fuels marketing business in the U.S. continues to evolve, we believe this transition is the best way for Exxon Mobil to compete and grow in the future,” said Ben Soraci, the director of Exxon Mobil’s U.S. retail sales.
Exxon Mobil is not alone among Big Oil exiting the retail gas business, a market where profits have gotten tougher as crude oil prices have risen. In fact, industry officials say the major oil companies own fewer than 5 percent of U.S. gas stations.
Gas prices reached a new record at the pump Thursday, rising to a national average of $4.06 a gallon. Still, station owners say they’re struggling to turn a profit on gas because while wholesale gasoline prices have risen sharply in recent months, they’ve been unable to raise pump prices fast enough to keep pace.
Most gasoline retailers long ago got past any illusion they can make money by selling gas. They rely on gas sales to drive traffic to their shops, where they hope auto repairs or food and drink sales will help them turn a profit.
Jeff Lenard, a spokesman for the National Association of Convenience Stores, said Exxon Mobil’s decision to sell its stations is not surprising given similar moves by BP, Shell and others.
“They can actually point their attention to some other area where you can make money,” Lenard said. “Retail is incredibly volatile. This way, they can (sell gasoline) wholesale and count on a fairly predictable income.”
Exxon Mobil said it sells about 14 billion gallons of gasoline annually at its U.S. branded stations.
Its shares fell $1.55, or 1.75 percent, to close at $87.06 in trading Thursday. They’ve traded in a range of $77.55 to $96.12 in the past year.