Free Market and Gasoline Distribution

Over at Blue Oregon Kari Chisholm attempts to misplace blame in telling the unsurprising story of a Salem service station operator, Brent DeHart, who appears to be getting screwed by Shell Oil which is both his supplier and the owner of an adjacent corporate station which underprices Dehart.

At first glance I’ll accept that DeHart is getting screwed and I suspect is in the company of many others in the Northwest who have had the same thing happen at the hands of one or another of the big oil vendors right along with a lot of drivers who are hammered by zone pricing (I’m lucky enough to be able to conveniently buy gas on my commute for 14-20 cents a gallon less then the same brand near my residence).

However, neither Chisholm nor Dehart give enough information to make a final judgement on the situation. It is, though, clear that DeHart is not an uninformed actor. As a former president of the oregon gasoline dealers association he should understand the business, the contracts that he signs with his suppliers and how big oil operates at the local level. So, I’d like to see some more detail at DeHart’s web site about the details of his contract and exactly why he can’t buy his gasoline somewhere else.

Chisholm’s agenda seems to be less to support DeHart than to attempt to discredit something he calls the free market:

But now that he’s getting screwed by the free market, Brent DeHart wants a narrowly tailored regulation to protect his business.

Yep, according to Chisholm DeHart isn’t getting screwed by Shell but by this free market thing. Now I might consider the oil industry a fine example of government/industry backscratching cooperation. But an example of a free market? Nope.


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, the closest thing to a free market in the US is probably the trade in illegal recreational drugs and the War on Drugs is exemplary of how local, state and federal governments behave toward free markets.

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1 Response

  1. Actually, I’d agree with you that the oil industry is one fine example of an industry that is very much protected and supported by government action.

    Except that is, it would appear, at the level of the local gas station. I don’t have all the info from Brent – check your local media for more info; the story is everywhere – but it seems pretty clear that Shell Oil is coming in with predatory pricing (which is illegal in many states) to try and wipe him out.

    I’m hopeful that the avatars of the free market ideology (who currently run the Oregon House) see what’s happening to one of their own and learn a little life lesson here.