Pump pain: Gas stations blaming Wall Street speculators

Washington's gas stations don't want to be held responsible for high oil prices — they say they're just passing along the cost.

So now they're passing the buck to where they think the blame lies: Wall Street.

The Washington Oil Marketers Association (WOMA) is putting brochures, fliers and signs in gas stations, urging customers to lobby their legislators "to fight back against oil speculators and control runaway oil prices."

Gas stations make 2 to 5 cents in profit per gallon, no matter what the cost of fuel is, said Lea Wilson, WOMA's executive director. And the more prices go up, the less fuel people buy.

The PR campaign, launched nationally by the Petroleum Marketers Association of America, comes amid a global epidemic of finger-pointing over oil prices, which have nearly doubled over the past year, ending this past week at $134.77 per barrel.

Populist politicians blame Big Oil and the Organization of Petroleum Exporting Countries (OPEC) for raking in huge profits. Economists cite the weakening dollar as a contributing factor.

Most industry analysts blame thinning supplies: Developing countries like India and China are consuming more, while oil production can't keep up the pace.

But Wilson doesn't buy the supply-shortage argument. "We believe right now there's plenty of supply in the marketplace," she said.

That's exactly what OPEC — which refuses to open its crude-oil spigots any wider — has been saying ever since oil prices began climbing in 2004. It claims the high prices seen these days are the fault of financial players that have snapped up billions of dollars in oil futures, as other sectors of the economy suffer.

Oil giants like Exxon Mobil have echoed that concern, too, and even the federal Commodities Futures Trading Commission is looking into Wall Street for potential mischief.

Wilson, who would like tighter regulation of trading in oil futures, says there's nothing to prevent an oil-producing country that's at odds with the U.S. — like Iran — from buying up a lot of crude-oil futures and then generating an international crisis that drives up the price and yields a large profit.

There's no tangible proof that this has ever happened. But if it sounds paranoid, there are experts who agree.

"There's no question in my mind that this market is manipulated," says prominent oil analyst Fadel Gheit, of Oppenheimer & Co. in New York. He said that 50 percent of the price "is not justified by market fundamentals. There has to be an invisible hand behind the move."

— Ángel González

Governor's staff makes tanker contract gaffe

Minutes after Boeing's surprise triumph this past Wednesday in its protest over losing the Air Force tanker contract, Gov. Christine Gregoire's staff rushed out a statement — bemoaning the hometown favorite's defeat.

"This is disappointing news for Boeing and the entire state of Washington," declared the errant news release, delivered by e-mail to newsrooms around the state. "While the company deserved the Air Force contract, without it, Boeing will remain the best manufacturer of airplanes in the world."

Six minutes went by before the gaffe was corrected and the Governor's Office issued an appropriate celebratory statement. "Today's decision is great news for Boeing and the entire country. ... "

Apparently there's something about the tanker contract that addles the brains of political press aides — maybe it's the big money and jobs at stake, or the opportunity to be widely quoted.

U.S. Sen. Kay Bailey Hutchison of Texas fired off a news release that was equally off-target back in February, when the Air Force announced that a Northrop/EADS joint venture would get the lucrative contract instead of Boeing, the expected winner.

"Today's contract win for Boeing represents great news for the state of Texas," her statement declared.

To their credit, Hutchison's staff fixed their blooper in only five minutes.

— Rami Grunbaum

Manhattan, Oprah still elude Nordstrom

Nordstrom no longer holds out hope of opening its first Manhattan store on the famed Drake Hotel site at Park Avenue and 56th Street, and it might not open a store in Palm Desert, Calif., as previously announced.

President Blake Nordstrom candidly detailed those wrinkles in Nordstrom's expansion efforts last week to a packed Bellevue Chamber of Commerce luncheon crowd.

He said the Seattle-based retailer nearly had a deal for the former Drake site, but would-be developer Harry Macklowe ran into financial problems.

The site would have given Nordstrom a flagship near ultra-pricey retailers such as Prada, Burberry and Dior — and a rent bill to match, at more than $45 million annually.

"That was a little scary," he said.

Nordstrom added that while the company is still "kicking tires" in Manhattan, "it's not going to go there" if the economics don't work.

As for the Westfield Palm Desert mall, where Nordstrom has announced plans to open a store in 2011, things also look iffy. Delays continue in redevelopment of the mall, he said.

"We're really worried if it's going to happen," he said. "Unless the mall is done the way it needs to be done, we won't be a part of it."

Other points Nordstrom made in the long, off-the-cuff talk, delivered without notes or slides:

• A continued downturn in the U.S. housing market, turbulence on Wall Street, and rising food and gas costs are conspiring to create the most challenging retail environment that he can recall.

"We've never experienced what we're going through this year," he said. "We're fortunate that we have a fairly affluent customer base.

"In theory, they could still be buying," he added. "But the confidence is missing."

• Widespread rumors that the upscale department-store chain Saks Fifth Avenue is up for sale might be true, he said, but Nordstrom is not a likely suitor. "We don't want to run someone else's nameplate," he said.

• His father, Bruce Nordstrom, is one of Oprah Winfrey's biggest fans and thinks she should be on the company's board of directors.

"Our business goes through the roof with Oprah and her 'Favorite Things,' and then she does reruns. ... Oh my God," he said. After Winfrey recommended Ugg sheepskin boots, there seemingly wasn't "a sheep left alive."

Bruce Nordstrom persuaded Winfrey to visit him at home a while back — but she's yet to join the board.

— Amy Martinez

For sale: Triangular site with several attractive points

By the first three rules of real estate — location, location, location — the historic Fairview Club should be an easy sell. Its 2022 Boren Ave. address puts it squarely between South Lake Union's real-estate boom and downtown.

But marketing this 300-seat banquet hall is a question of geometry, not geography. Bounded by Fairview Avenue, Boren Avenue and Denny Way, it's on a tiny, triangular lot.

The one-story building, which has been on the market for two weeks at an asking price of $4.5 million, has a shape to rival New York's Flatiron Building, and a footprint of just 8,000 square feet. That could make it difficult to put up the 400-foot-tall tower allowed by its zoning.

"The biggest challenge on small oddly-shaped lots is parking," said Stuart Williams, principal with the Pacific Real Estate Partners brokerage.

A 7,000-square-foot rectangular parking lot across Boren Avenue is also for sale for $3 million. Steve Pelluer, a broker with Cannon Commercial, which is marketing the two properties, said he hopes they will be sold together. The site has received one bid so far, Pelluer said.

Though the parcel's size and shape may be ill-suited for a 12-story structure like the one going up across the intersection, the Fairview Club building is no stranger to improbable use: It was originally a tie factory.

Built in 1929 as the Fashioncraft Building, the Art Deco structure was home of Fashion Craft Cravats. It was renovated in 1975 for Fashioncraft's successor, Brittania Sportswear, according to a report filed with the building's nomination for historical landmark status, which was never approved.

The brown-brick building was sold in 1993 to current owner Mirza Agha of Bellevue for $420,000. He did not return calls seeking comment.

It's assessed at $2.8 million, according to county records.

The club still hosts events every weekend through Tony's Events & Catering, whose lease expires at the end of the year.

— Isaac Arnsdorf

Comments? Send them to Rami Grunbaum: rgrunbaum@-

seattletimes.com or 206-464-8541