BOSTON -- Service-station owner Paul O'Connell has gotten an earful from angry
customers filling up at his gas pumps.
“We are the first ones they see, and we are the one they take it out
on,” said O'Connell, who owns an Exxon station in Lunenburg.
O'Connell said his customers are angry about record-high gas prices, which
soared above $3 a gallon after Hurricane Katrina hit the Gulf Coast.
But O'Connell said big corporations, such as credit-card and oil companies,
“not small, individually owned gas stations” are making millions
off high gas prices.
“The banks are making a killing,” said O'Connell,
who is also executive director of the Billerica-based New England Service Station
and Automotive Repair Association.
O'Connell spoke to legislators yesterday during a hearing about gasoline prices
for the Committee on Telecommunications, Utilities and Energy.
He said credit-card companies have increased fees for gas stations
that allow customers to use credit cards to pay for gasoline.
O'Connell said when gasoline cost $1.50, credit-card companies charged roughly
45 cents per gallon. But companies have pushed that fee up to 9 cents for every
“Now more people are using credit cards (to pay for gas) because they
don't carry around that kind of cash (to pay for high prices),” O'Connell
said. “The banks are overcharging us, but gouging is a strong word.”
Sal Dampolo, who owns a gas station in North Billerica, told legislators he
has the same problem.
“The credit-card companies are making almost as much as the oil
companies,” Dampolo said. “On our end, we mostly have a loss of
profits. ... Four years ago, I was making more money selling at 89 cents a gallon
than I am today.”
O'Connell said large oil companies own and operate only a handful of local
gas stations, although many offer a brand name of gasoline.
O'Connell said most gas-station owners have to increase prices to pay for the
rising cost of their supply.
“If we didn't pass the cost on (to consumers), we would be out of business,”
O'Connell said prices “went absolutely crazy” a few days after
companies started to assess the damage caused by Katrina.
Gas prices were $2.53 per gallon two weeks before the storm, and on Aug. 30,
the cost jumped to $2.70 per gallon, O'Connell said, and the price was up to
$3.57 per gallon by Sept. 2.
“I think people are coming around,” he said. “Some people
are starting to understand we are ... getting bumps and bruises, too.
“Why would we alienate our customers? I wouldn't raise prices unless
I had to.”