Collateral damage: Backlash against Russian-branded gas stations hits American workers

The Newark City Council voted unanimously Wednesday to ask the city’s business administrator to suspend the service stations’ operating licenses, citing Lukoil’s base in Moscow.

In doing so, however, they may have predominantly been hurting Americans.

The stations are franchises owned by locals, not Russians. They employ mostly New Jersey residents. And the gasoline sold at the stations comes from a local Phillips 66 refinery.

The campaign targeting the gas stations is one example of collateral damage from the backlash against Russia, as government officials and customers race to show their support for Ukraine by boycotting products and companies—or things they perceive to be Russian.

Roger Verma, a New Jersey resident who immigrated from India 45 years ago, has owned the franchise for one of the Lukoil stations in Newark since 2005. He said the decision to yank his license left him baffled and concerned that he could be put out of business, which would affect his 16 employees.

“Let me be clear that I stand with Ukraine and I’m fully in support of Russian sanctions,” Verma said Wednesday in front of Newark’s City Hall. “But I’m baffled and confused how people sitting in these positions without having any of their facts together and without having full knowledge of how things are done can introduce and change laws and change people’s lives just like that.”

In some places, people have been pouring out Smirnoff vodka, not realizing that the beverage is owned by an English company and the bottles consumed in the U.S. are distilled in Illinois.

Charlie Tgibedes, owner of Box Seats, a restaurant and sports bar in North Attleboro, Mass., told The Sun Chronicle newspaper he’s not ordering more vodka from Russian companies but questioned the wisdom of tossing what he already has.

“It looks good doing it, but the stuff is already in the building and paid for. You’re just hurting yourself dumping it down the drain,” he said.

On social media, people have called for boycotts of Lukoil stations, which operate in 11 states, mainly in the northeastern U.S.

Newark officials said going after the Lukoil stations was the moral thing to do, even if they are locally owned.

“All of us are horrified by the images we’re seeing” from Russia’s invasion of Ukraine, Council Member Anibal Ramos said Wednesday. “Today Newark is standing in solidarity with a number of countries around the world who are supporting democracy and taking sanctions against the Russian federation.”

A phone message couldn’t be left at a listing for Lukoil Americas Corp. in New York.

In a statement posted on its website Thursday, Lukoil’s board of directors expressed “its deepest concerns about the tragic events in Ukraine” and called for “the soonest termination of the armed conflict.”

“We express our sincere empathy for all victims, who are affected by this tragedy. We strongly support a lasting ceasefire and a settlement of problems through serious negotiations and diplomacy,” it said.

It wasn’t immediately clear Thursday when the Newark stations’ licenses would be revoked, or if the city administrator might halt the suspension. Ramos, who introduced the resolution, said he anticipated it would still happen.

Under a typical Lukoil franchise agreement, the company acts as the station’s landlord. The station pays rent, taxes and utilities to the company and also agrees to buy a certain amount of fuel each month.

Sal Risalvato, executive director of New Jersey Gasoline, Convenience Store and Automotive Association, called the crackdown on the stations “nothing more than political theater.”

“All of the station owners condemn what Russia is doing in Ukraine, but do not deserve to lose their businesses and their investments because of Russia’s bad behavior,” Risalvato wrote in an email.

Ramos said the license suspension in Newark is meant to be temporary and his office had received calls from employers offering to give jobs to any affected gas station workers.