As turmoil in the Middle East endures, and as gas prices linger just below the $4-a-gallon mark, one U.S. oil company is offering a rather ambitious guarantee: “There is no Mideast oil in our products.” The United Refining Company, based out of Warren, Pennsylvania, pledges that 100 percent of the gas it sells is refined from North American crude — meaning, the oil comes only from the U.S. and Canada.
“We think Americans feel good about it,” says John Catsimatidis, CEO and chairman of the United Refining Company. “People drive by, and every time they get annoyed at… (Hugo) Chavez, every time they get annoyed at BP Petroleum, every time they get annoyed at the Middle East, you know what they say? ‘Why don’t I buy American oil and buy American-made gasoline?’ “
The gasoline is sold at more than 300 stations in Ohio, Pennsylvania, and New York under the Keystone, Country Fair, and Kwik Fill brand names. The company, which brands its products as “American Made Gasoline Driving America!,” pumps out approximately 70,000 barrels of oil per day through its facilities in Warren, Pennsylvania, one of the destinations that a 35-year-old Canadian pipeline runs through.
United Refining Company has enjoyed groundbreaking profits since it launched its “Made in America” marketing campaign, which heavily advertises its no-Mideast-oil guarantee. Television commercials tout the benefit, Kwik Fill stations have “Driving America” signs strung across their stores, and the slogan is even branded on some of the gas pumps. The Kwik Fill website highlights the company’s “buy American” approach:
The Kwik Fill / Red Apple convenience store chain is owned and operated by United Refining Company based in Warren, Pennsylvania. United Refining Company uses no overseas crude oil to produce its petroleum products. In fact, United Refining Company uses only 100% North American crude oil, and that oil is refined right here in Pennsylvania. When you buy United Refining Company gasoline at Kwik Fill, you can be assured that your money is not going overseas. This benefits 2300 Kwik Fill employees in NY, PA, and OH and the communities in which they, and you, live. By helping local businesses and economies, we keep jobs in America and keep America strong.
“Our businesses… our families… and our future depend upon a strong America,” the brand’s motto proclaims. “Keep America strong… buy American-made gasoline at Kwik Fill.”
“That’s why I buy here,” Jan Potter, a Kwik Fill customer, told Fox News, “because it’s made in the U.S.A.” Ms. Potter says she is “one of the Americans that’s upset about us being so tied to other countries for our oil and gas, and I would much prefer to buy American than from other countries.”
Since the “Made in America” campaign’s inception, United Refinery Company’s sales have soared, cranking out profits for 27 consecutive quarters. Yahoo! Finance expounded on the company’s recent financial boom in an article published earlier this month:
Adjusted EBITDA(1) [earnings before interest, taxes, depreciation, and amortization] on a FIFO basis for the six months ended February 29, 2012 was $115.0 million , an increase of $83.3 million or 262.7% from $31.7 million for the six months ended February 28, 2011. For the second fiscal quarter ended February 29, 2012 the Company generated Adjusted EBITDA on a FIFO basis of $40.5 million, an increase of $11.8 million or 41.1% from $28.7 million for the three months ended February 28, 2011 .
Mr. Catsimatidis says utilizing domestic energy sources, and sources from friendly neighbors — rather than unstable countries in the Middle East — offers greater price stability and less volatile supply for their customers. “What happens if Iraq gets bombed, or Saudi Arabia gets bombed, or Iran stops shipping?” he asks, adding that pipeline transportation is more efficient and less expensive than transporting oil on tankers across the ocean.
The U.S. Energy Information Administration reports that the U.S. imports 45 percent of its oil from foreign nations, one-fourth of which comes from Canada. Saudi Arabia accounts for about 13 percent and Venezuela about 10 percent, while total imported oil reached a high of more than 60 percent in 2005.
Mining for oil here in the U.S. and transporting other oil from Canadian sources is “going to make prices lower,” Chicago-based oil analyst Phil Flynn affirms. Mr. Flynn claims that selling strictly U.S. and Canadian oil means “you don’t have to ship oil from the Middle East, you don’t have to worry about an Iranian war premium, you can produce oil at home, or in Canada, and that is going to keep the price of gasoline down… bottom-line, is that when it comes to gasoline prices, more domestic production over the long run is going to lower gasoline prices.”
This is why many critics argue that TransCanada’s Keystone XL oil pipeline is critical, for both jobs and for America’s energy security. The approval of the Canada-U.S. pipeline would translate into tens of thousands of jobs and, ultimately, a steep decline in gas prices. Furthermore, it would send a message to the world indicating that America is curbing its energy reliance on hostile, terrorist-sponsored nations.
