HOUSTON ---ConocoPhillips is selling 600 company-owned U.S. gasoline stations to PetroSun West LLC for $800 million, marking the oil company's exit from the retail business, Reuters reported.
ConocoPhillips operates the Phillips 66, Conoco and 76 brands in the western and central United States. It is the latest big oil company to sell its service stations.
"Tying up capital in a retail gas station is not its most efficient use," Phil Weiss, energy analyst at Argus Research Co., told Reuters. "The margins on the product side aren't that high. You can be getting only pennies a gallon."
Service stations have struggled with shrinking margins even as gasoline prices topped $4 per gallon because they have not been able to keep pace with soaring crude oil prices, Reuters reported.
In June, Exxon Mobil Corp. announced it planned to leave the retail gasoline business by selling the remaining 2,220 stations it owns. BP Plc is also selling its U.S. retail business.
PetroSun said the deal will leave it with operations in 10 states and annual petroleum sales of more than 1 billion gallons.
Conoco, the third-largest U.S. oil company and second-largest refiner, will continue to produce gasoline and sell fuel on a wholesale basis.