Team Boston - The Sun January, 2002 Volume 5, Issue 1 Page 3

Industry Trends
Albertson’s offers consumers the chance to lock in the price of their summer ‘gas’ purchases this spring. Activity in the futures market suggests that someone is readying a guaranteed gasoline pricing plan, and that someone may just be a hypermart, warns noted oil economist Phil Verleger. "Look at the futures numbers," says Verleger. "Someone is out there buying up gasoline futures and may be preparing to launch a pre-paid plan that offers consumers in February and March the chance to buy their spring or summer ‘gas’ at a locked-in price, along with their garden furniture." It would cost virtually nothing to offer such a program — in fact; a discount chain could make a handsome profit on the deal. If the chain could lock in futures market gasoline for, say $70cts/gal, even with state and federal taxes added, it could make a nifty profit if it guaranteed consumers a pump price of, say, $1.15, he says.	Pre-paid fuel would also be an easy way for a discount chain to get around state below-cost laws. Consumers would pre-pay, for, say, 400 gallons of fuel. As long as the original price they paid was within minimum markup requirements in below-cost states, it wouldn’t matter if the price were below street when the fuel was actually pumped into the customer’s car, he told Oil Express last week. After several years of top secret development, Shell is now testing an additive that it believes could separate its gasoline offering from the other major oil firms. As first reported by Oil Express 10/22, 9/7, Shell believes that the new additive has friction reduction properties that will enhance mileage and give its gasoline an edge over other brands. Initial tests indicate that customers are getting an average five miles more per tank of gasoline, Shell says/ Plans call for a national rollout in 2002, complete with broad-based print and media ads touting the extra mileage.