Originally Posted By: TiredTrucker
One may be able to boycott a XOM station, but they cannot boycott XOM fuel. A terminal will get its fuel from a variety of refineries. And all the stations in the local area get their fuel from the same terminal(s) in the area. Only thing different is the additives shot into the fuel stream as it is loaded on the tanker for delivery. Any station, on any given day, will have a mix of refinery fuels in the tanks. They don't get to pick which refinery they get their fuel from. They can only select a terminal from those in the area. And every station uses a simple method.... what terminal has the lowest current market price on fuel and the distance that affects delivery cost.
I think there are a few variables at work here. One is that if it's 93 octane it may be a "specialty fuel" that's not necessarily sold as a commodity. I've certainly heard about a wider distribution of 93 octane in the Midwest, but I was under the impression that it was due to lower demand for premium making higher octane premium more practical. It may not be. A few years back I was in Florida and I did see some gas stations selling 87/89/92/94. The latter carried a steep price increase (maybe 20 cents over 92). However, I understand that some gas stations in the Midwest might have 87/89/93.
Also - a lot of brand name stations have contracts to buy directly from their brand name refiner. When there have been rapid price fluctuations, a lot of franchise owners around here have complained that they were locked into paying the price of their brand name refiner. Of course the delivered fuel may be a commodity even if it's "purchased" as a branded fuel. I understand the way that the major pipeline operators work is that they're paid to accept RBOB at a refinery and they're obligated to deliver the same amount of equivalent fuel at terminal X, Y, and Z for that refiner's customers. The pipeline operator saves time and expense by routing fuel in the shortest route possible to meet their delivery requirements, and other fuel typically comes from the closest refinery to save on transportation costs. Of course that's where the ethanol is added since pipelines don't play nice with ethanol.
I get that a refiner can pay more to get a "segregated" delivery of fuel from point to point rather than the "fungible" model. Colonial describes it pretty well:
Quote:
http://www.colpipe.com/home/about-colonial/frequently-asked-questions
What is the difference between fungible and segregated products?
Fungible products shipped on the Colonial system are generic products. These products meet published Colonial specifications. Shippers will receive equivalent product but may not get back the actual product shipped. Segregated products are branded products or blendstock materials. On segregated shipments shippers receive the same product they injected into the system.