Gouging on gas leaves motorists over a barrel - So why is the price of gasoline soaring? Can you say $$$$$.99?

www.bayarea.com Posted on Sat, Mar. 15, 2003 By Dennis Rockstroh Mercury News

I asked my pal Ray Olyaie, proprietor of the gas station at Fremont's busiest intersection and victor in a long battle again his nemesis, Exxon, for overcharging.

$$$$$.99,'' he said, or something like that. Because they can. When the war starts, I expect gasoline to cost at least $3.''

Already, prices at the pump have shot to all-time highs in 16 states.

Why?

Profit. Moolah. Money. Bread. Dough. Coin. Cash. $$$$.99.

I read to you from the Wall Street Journal, the newspaper of capitalism: ``Worries over a war in Iraq, a cold winter, the lingering effects of a recent labor strike in oil-producing Venezuela and complications in the increasingly lucrative oil-refining business are having potential effects on gasoline supply.

``One result: For some big oil companies, the profits could be huge.''

And why is California leading the drive upward?

Again the WSJ: ``One reason may be that California refining companies are currently reaping profit margins that are as much as 21 percent above the average for the past seven years.''

Laws favor companies

This strikes some people as wrong, possibly illegal. But they forget who writes the laws. And I don't have to tell you that some oilmen have been very successful in politics.

The governor wants an investigation, and two Bay Area legislators are calling for federal action.

Sen. Barbara Boxer, D-Calif., has asked the General Accounting Office, Congress' investigative arm, to inquire into gasoline prices here.

Rep. Mike Thompson, D-St. Helena, has introduced legislation to prohibit the practice of manipulating prices and preventing wholesalers from selling gasoline more cheaply to independent stations. Of the 8,500 gas stations in California, 6,500 are independently owned.

It is possible to beat Big Oil.

But don't hold your breath.

It takes courage and an iron will.

Like that of Olyaie, who waged a decadelong war with Exxon. And won.

In essence, he alleged that Exxon was overcharging all of its directly served dealers and prohibiting them from buying the same gas at a cheaper price from wholesalers.

Today, Olyaie's gasoline station is a Valero. But in the old days, it was an Exxon.

Over the years, while his battle raged with Exxon, Olyaie staged special gasoline sales to make his point.

The battle lines

Once, he gave gasoline away for one day to attract attention.

Another time he sold it for 99 cents a gallon, telling everyone that that was what the proper price should be if Exxon wasn't overcharging.

Exxon fought back.

The company even declared victory and scheduled Olyaie's surrender at high noon.

Wrote Exxon's E. Lee Curry to the combative Olyaie: ``Please arrange to be at the station at 12 o'clock noon on or before Nov. 01, 1994 to meet with your territory manager to surrender the premises and take the necessary steps to accomplish an orderly termination of our relationship.''

Olyaie told Exxon in so many words to go take a flying leap.

Olyaie is still at Fremont Boulevard and Mowry Avenue. Exxon is not.

In 1991, Olyaie joined a group of current and former Exxon independent dealers in suing Exxon for overcharging.

In 2001 a jury returned a verdict in favor of the dealers. The jury found that beginning on March 1, 1983, until Aug. 28, 1994, Exxon had overcharged its dealers approximately 1.3 cents per gallon. During that time, Exxon sold more than 40 billion gallons of motor fuel.

Exxon will have to repay the money if it loses its appeal. Olyaie's share would be about $230,000.

Now that's $$$$.99.

Contact Dennis Rockstroh at drockstroh@sjmercury.com.