Zone Pricing

Zone pricing is when big oil companies, or large distributors carve the state into hundreds of smaller zones, and sell gasoline at higher prices to some retailers, while selling the same product at a lower price to others.

This is done to game the market and reap larger profits in geographic areas where they determine they can force consumers to pay a higher price. Retailers of the same brand often pay as much as 35 cents more per gallon than competitors only a few miles away. They are left with no choice but to pass that expense on to consumers, who wind up paying more all so that these mega distributors can line their pockets. Motorists must pay higher prices while thinking that their local retailer is charging excessive prices. There are cases when the price a retailer is being charged at wholesale is greater than the cost his competition down the street is charging at retail.

NJGCA has been fighting for years for a legislative ban on this practice. In June 2013 the Assembly Consumer Affairs Committee unanimously passed A-2729, a compromise bill that will protect smaller distributors while providing real savings for small businesses and consumers.

In December 2013 the Senate Commerce Committee also passed the bill to ban zone pricing, despite objections from Sunoco and Lukoil.  It now needs to be voted on by the full Assembly and the full Senate.

 

Pages: 1 2