(BP boycott article updated for reports of gas station owners dropping BP brand)

NEW YORK ( TheStreet) -- Driving by a BP-branded gas station any time in the last two months, your garden variety gas-guzzling U.S. driver has been faced with this moral dilemma: to fill up at the BP pump, or bypass BP and find another gas station?

As the question about a BP boycott has come into focus for many Americans frustrated and angered by the BP oil spill response, the idea of a BP boycott has led many to discover that BP's business in the U.S. is not as simple as its branded gas stations. Bypassing the BP gas station may feel good, but it may not be a true BP boycott.

For example, many consumers who thought they were involved in an active BP boycott discovered while filling up at an Arco station that they were, in fact, buying BP gas. AM/PM convenience stores attached to many Arco stations are the same story, as well as Amoco products. Even the supermarket pumping stations aren't safe, though they seem so on the surface. Safeway stations are fueled by BP, according to a report in the Los Angeles Times that got to the heart of the Boycott BP problem.

The shock at the pump that many consumers received when they discovered that they were still buying BP gas is just the most striking example of how difficult a BP boycott is to pull off.

About 9,700 service stations are branded with the BP name east of the Rocky Mountains, according to the LA Times.

In the West, including California, there are 1,350 Arco stations selling BP oil, and most of these locations include the AM/PM convenience stores where purchases of soda and chips ultimately support the BP franchise system and its tentacles all across the U.S..

In all, there are more than 11,000 BP-branded stations across the U.S., according to a report in the Chicago Tribune.

Yet information from the U.S. Energy Information Administration shows just how difficult it is to track the path of crude oil to the pump. BP's five U.S. refineries don't just process its crude oil. Once crude oil is extracted from a well by BP or any big oil company, it could be sent to a BP refinery or sold on the global commodity markets. Price and distance from a BP refinery are issues that can determine the path of the crude oil on its way to the pump.

The gasoline that the BP boycott consumer is putting into their pump could, in fact, be at least partially BP oil. Gas stations often offer oil that is a mixture of brands from various refiners and multiple global origins, as the refined oil is typically shipped by pipeline. It is the additives placed in the final gasoline product, and not the oil itself, that often distinguishes one brand from another, the Chicago Tribune report noted.

It's also important to remember that since BP gas stations are run under the franchise model, consumers who boycott BP may help to force the individual owner out of business, but BP, the global oil giant, will not feel the pain itself.

A consumer group, Public Citizen, has called for a three-month consumer boycott. BP-branded gas stations have been vandalized, rifled with gun shots, smeared in mud, and put on the front lines of dealing directly with anger related to the British oil company's mismanagement of the oil spill. There has even been a Boycott BP Facebook page created and which has attracted 750,000 fans.

BP has gotten into the social media game itself. President Obama chastised the company for spending $50 million on a brand advertising campaign, but the cheaper social media of Twitter, Facebook, YouTube and Flick is now as significant a part of the BP image resurrection effort. On Facebook, for example, BP is posting real-time updates about its oil spill response effort.

BP stock hasn't needed any help in recent trading, though. Its individual gas station owners may still be struggling to win consumers hearts, minds and gas tanks, but the markets have suddenly turned favorable on BP stock.

Granted, BP sank to an oil spill low of a $27 share price on June 25, so its recent recovery is within the context of its larger share freefall. Nonetheless, last week was the first winning week for BP stock since the oil spill crisis began on April 20, with a rise of 7%. On Tuesday, BP shares were among the biggest gainers in the market rally, and leading the energy sector stock group up, with a rise of 6.5%, a rally that continued with the general surge in crude oil and energy stocks on Wednesday.

The BP boycott is just one among a seemingly endless string of pressure points being applied to BP, and all things considered, is probably minor in terms of the financial price tag to the global company. The estimate of $50 million to $70 million that BP is offering in financial assistance to BP-branded gas stations is less than the $100 million it is estimated that BP is spending on a daily basis in its overall oil spill response. On Wednesday, a Senate committee voted to remove any cap on liabilities resulting from the oil spill, and sent the measure to the full Senate, which had previously blocked the legislative effort to force BP to write a blank check.

Celebrities like Kevin Costner have oil-spill technology being used by BP as part of the oil-spill response, but other celebrities are getting into the Boycott BP action. Hard rock stars Jonathan Davis of Korn and Rob Zombie are leading boycotts of the oil company.

Indeed, given the unintended burden on BP gas station owners, BP agreed on Tuesday to provide financial assistance to owners of BP-branded gas stations, in the form of cash compensation, reductions in credit card fees paid by merchants, and support in the form of a national advertising campaign.

The cash component of the financial assistance will be higher for gas stations in the Gulf Coast, John Kleine of the BP Amoco Marketers Association told the AP. Kleine estimated the BP package at $50 million to $70 million. The deal does not preclude gas station owners from seeking compensation for oil spill damages from BP by legal means, the gas station representative told the AP. There are estimates that some gas stations have lost anywhere from 10% to 40% of their business as a result of the BP oil spill.

The BP Amoco Marketers Association, which represents 475 independent service station owners east of the Rockies, told the LA Times that BP protests and BP boycotts have cost BP service station operators as much as 20% of their normal business.

The BP plan to assist individual gas station owners has already received some criticism. BP opted to leave the dispensing of financial assistance to distribution companies that have direct relationships with the gas stations. Yet some gas station owners expressed concern to Bloomberg they may never see assistance in the form of reduced credit-card fees and fuel rebates of one cent a gallon with discretion left to the oil distribution companies. The total BP financial aid package for retail gas outlets works out to roughly $5,200 per station.

In any event, the BP effort to shore up the business of individual gas station owners wasn't stopping some defections. Owners of gas stations in Michigan who said they had not yet received any financial assistance were switching over their stations to brands including Sunoco, the owners told the Detroit Free Press.

"It's either change or go out of business," one BP gas station owner told the hometown paper. Other gas station owners told the AP they were in the process of trying to switch away from the BP brand, with individual stations in the area reporting daily loss of business in the range of 35% to 40%, reflecting the higher end of the business losses estimated by the BP Amoco Marketers Association.

These concerns don't even touch on the fact that BP fuels the commercial jets that we fly, as well as just about every possible form of transportation through which items are shipped across the U.S.

A BP boycott could mean that your summer travel plans need to be re-routed for bicycle paths, that cruise to the Caribbean is out, and you better find a replacement for home use of natural gas -- the Los Angeles Times notes that BP's natural gas clients include Southern California Gas.

And how about BP wind farms and solar panels? Southern California Edison buys electricity generated by BP-owned wind farms. Should a BP boycott even include its alternative energy generation?

Others contend that a BP boycott is worthless since it puts a consumer in the default position of supporting Exxon Mobil ( XOM), or any of the big oil companies. The goal should be to wean ourselves off our addiction to oil as a result of the BP oil spill, not to think that a BP boycott is the end-all and be-all of moral and civic responses.

So what's a consumer to do? It may feel good to drive by the BP station in your 12 mpg Escalade, but is it the best we can do as a society as a response to the BP oil spill?

Indeed, it raises the question, Are you involved in a BP boycott -- and if so, what does "BP boycott" mean to you? Take our poll below to see what the TheStreet has to say.

Are you boycotting BP? And if so, what exactly does a BP boycott mean to you?

Everyone needs to boycott BP-branded stations.
A BP boycott is useless.
I'm focusing on personal energy efficiency.
It's unfair to boycott the individual station owner.
I'm trying to boycott each and every chain in the BP web.

-- Written by Eric Rosenbaum from New York.


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