May 26, 2006

In this Issue of Jobbers World Online News Briefs
  • Big Price Moves!
  • ConocoPhillips lifts allocations
  • Got News?

  • Big Price Moves!

    According to industry sources, BPCastrol, Citgo, and ExxonMobil have now advised their marketers of a price increase. And from what Jobbers World is hearing, the increases are big.

    Castrol reportedly hiked its prices up by $0.58 to $0.64 a gallon. The high end of this range applies to its synthetics. Marketers say that after layering these increases onto the current everyday prices for Castrol’s PCEO, Castrol price will be in the area of roughly $8.00 a gallon for conventional PCEO.

    ExxonMobil and Citgo reportedly also announced price increases. According to a number of sources, each company bumped the price of its conventional lubricants by $0.48 a gallon. Synthetics are reportedly going up by a whopping $0.72 a gallon. Citgo’s price increase is said to take effect on June 19. ExMo’s increase will reportedly go into effect on July 1.

    It will be interesting to see if the market places the same level of value on the brand as some of the majors. But according to marketers recently surveyed in Petroleum Trends International’s First Annual Report Card on the Majors, they might not. Instead, a significant number of marketers say their customers jumped ship in record numbers after the last price increase. Many marketers are now saying the big brands are losing their luster because customers are seeing a widening gap between the designer brands and such others as mid-tier brands, gas brands and private label.

    The questions that remain now are about Shell and Valvoline. These companies have not announced a price increase.

    ConocoPhillips lifts allocations

    ConocoPhillips has reportedly notified its marketers that allocations will be lifted on June 1, 2006. This has to be great news for both ConocoPhillips and its marketers.

    In what had to be a heartbreaking experience for ConocoPhillips, it ran into a number of problems with it supply line during last years hurricane season, the result of which was allocation. And these problems could not have come at a more inopportune time. This is because ConocoPhillips was, in the vernacular of the street, “on a roll.”

    Prior to the hurricane season, ConocoPhillips was reportedly enjoying solid growth as a result of a number of new product introduction, its synthetic engine oil at conventional oil pricing strategy, being awarded several key national accounts, and other successful sales and marketing initiatives. But then the hurricanes hit and rather than continuing its push for growth, ConocoPhillips had to put its marketers and direct served customers on allocation. This certainly took the wind out of ConocoPhillips sales.

    The only question on the minds of marketers now is how quickly ConocoPhillips can recapture some of the business they feel it lost while allocations were in effect. But if a company's past performance says anything about its future perfromance, marketers say you can be sure ConocoPhillips will once again soon be "on a roll."

    Got News?

    If you have news about lubricant marketers... including acquisitions, new product introductions, alliances, promotions, new locations, websites, or others, please let us know.

    We will be glad to consider publishing this news in the Jobbers World Online News Brief.

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