Coming soon…

by Nathan Hamm on 1/27/2005 · 7 comments

Goodbye Getty, hello Lukoil:

Now, Moscow-based Lukoil Oil Co. is poised to begin a three-year program to replace the familiar red, white and blue Mobil design at 779 stations in New Jersey and Pennsylvania with what the company hopes will soon be an equally familiar red and white Lukoil look.

Lukoil, which purchased the Mobil stations as part of the ExxonMobil divestiture, will begin the changeovers in April. They will be scheduled in blocks of 30 to 40 stations, beginning in the Philadelphia-South Jersey market, said Vincent DeLaurentis, president and chief operating officer of Getty Petroleum Marketing Inc., Lukoil’s subsidiary that oversees North American operations.

When finished with the Mobil stations, Lukoil will resume its conversion of about 1,300 East Coast Getty stations, so that nearly 2,100 stations from Maine to Virginia will eventually fly the Lukoil banner. The stations will be marketed for cleanliness and quality, DeLaurentis said.

Why are they doing it? Listen to this and you’ll hear it’s to capitalize on the unbounded love and goodwill that Americans feel towards Russia.

I guess I should be seeing one of these rebranded stations soon.

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– author of 2991 posts on 17_PersonNotFound.

Nathan is the founder and Principal Analyst for Registan, which he launched in 2003. He was a Peace Corps Volunteer in Uzbekistan 2000-2001 and received his MA in Central Asian Studies from the University of Washington in 2007. Since 2007, he has worked full-time as an analyst, consulting with private and government clients on Central Asian affairs, specializing in how socio-cultural and political factors shape risks and opportunities and how organizations can adjust their strategic and operational plans to account for these variables. More information on Registan's services can be found here, and Nathan can be contacted via Twitter or email.

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Andy January 28, 2005 at 3:41 am

I remember seeing a Lukoil station when I was in Washington DC last summer. It startled me enough that I stopped to take a picture. I’ll see if I can dig it out.

Alexei January 28, 2005 at 10:35 am

What puzzles me more is why Lukoil bought Getty’s gas station chain a few years ago. Now that they own it, the rebranding isn’t that surprising.

Tatyana January 28, 2005 at 11:02 am

Now I recall a friend telling me about her spending a chance evening in a strange company of “new New Russians/golden youth in NY”; children of Lukoil high echelon operatives, nominally enrolled in various Universities here, and their lifestyle. Involved: breakfast bills of $350 p/person, rolling rates for paying some lucky PhD for their course papers, nighties decorated with diamonds, nightclubs, etc. I thought it was all BS….

Nathan January 28, 2005 at 11:26 am

What I’ve always heard is that it was to obtain a guaranteed distribution system in the US for their oil.

I can see why they hadn’t rebranded yet. People in the story kind of have a “Who?” reaction. I also get the impression that they had to rebrand the recently acquired Mobil stations anyway. Why go Getty when you can go Lukoil?

Mitch H. January 28, 2005 at 11:58 am

The office consensus is that if they wanted a recognizable “Russian gas” branding for their gas stations, it ought to have been “Molotov’s”. Just imagine the cute-company-mascot possibilities!

Alexei February 1, 2005 at 9:37 am

To think of it, Nathan, Lukoil has no problem selling its oil. What it is now selling in the US is obviously gasoline and diesel. If Lukoil produced oil, say, in the Gulf of Mexico, it would make sense to capture the whole value chain from the well to the gas pump. But most of its oil output comes from outside the US and either gets refined in Russia or sold in Europe. Now Lukoil would have to either bring this oil by tanker to the US (which has to be costly, or else the market would have assured that Russian oil gets delivered to the US), or buy crude in the market and refine it in the US, where refining margins aren’t very attractive, or simply buy refined products and sell them in a competitive market. None of these seems an attractive option. Unless there’s a grand strategy behind it all, of course.

Nathan February 1, 2005 at 11:04 am

You seem to have a much better handle on it than me, Alex(ei). I’m just repeating what I’ve heard. I have no clue whether or not they picked up refineries, etc. when they bought Getty. Something else I seem to remember hearing is that Getty was an opportunity that presented itself–something that might come in handy someday.

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