Unocal Won’t Extend Gas Price Freeze; Arco Will

Unocal Corp. said Wednesday that it would not extend a one-week price freeze on wholesale gasoline beyond its expiration at midnight tonight. Atlantic Richfield Co., however, extended its voluntary freeze on wholesale prices, due to expire at midnight Wednesday, indefinitely.

Unocal’s removal of the voluntary moratorium on price hikes could mean higher prices at the pump.

The freezes were imposed last week after President Bush asked U.S. oil companies to show restraint in pricing.

“We will not continue the freeze,” said Art Bentley, a spokesman for Unocal. “We said (last week) that we would freeze prices for one week as a response to the President’s request.” Bentley said he had no information about Unocal’s pricing plans, but said, “It’s possible prices could rise.”

About 11,000 dealers--nearly all of them independent of Unocal--sell Unocal gasoline. The company asked the dealers to hold the line on prices during the seven-day period.

Arco, which sells gasoline at 1,500 stations in five Western states, was the first oil company to announce a freeze after pump prices increased sharply in the wake of the Aug. 2 Iraqi invasion of Kuwait. Arco announced its one-week freeze Aug. 8, the same day Bush made his request. Getty Petroleum and Unocal announced one-week freezes on Aug. 9.

Executives at Getty Petroleum were not immediately available for comment.

Arco announced that it would extend the freeze at the wholesale level and at the retail level for 200 stations owned by one of its affiliates. The company continues to urge franchise dealers to maintain the freeze but doesn’t control prices at those stations.

Douglas Elmets, an Arco spokesman, said Arco will evaluate the freeze on a day-to-day basis, monitoring prices in relationship to the general market and the supply situation. He said its gasoline sells at retail for four cents to 12 cents lower than its competitors in Los Angeles. “Our sales volume has increased about 10% since the invasion (of Kuwait) and we’re concerned that . . . there could be a run on our stations, which could drain our supply,” Elmets said. “That’s why we’re looking at this on a day-to-day basis.”