Three ‘Big Oil’ companies agree to settle hot fuel lawsuits

Three of the country’s largest oil companies — BP Products North America, ConocoPhillips Co. and Shell Oil Products US — have agreed to settle lawsuits accusing them of profiting from “hot fuel,” which costs consumers of gas and diesel an estimated $3.5 billion a year

 The term “hot fuel” comes from the fact that gasoline and diesel expand in warmer months. Vehicles operated on warmer fuel get poorer fuel mileage and according to the Kansas City Star, oil companies dispensing the hot fuel cost consumers dearly.

The Star first reported the issue in a series of articles in 2006 that resulted in class-action lawsuits accusing oil companies and fuel-station chains of being involved in the practice.

After five years of pretrial proceedings, the first of the suits was scheduled to go to trial next month in federal court in Kansas City. But the three oil companies told the U.S. District Court that “they have reached a binding settlement agreement” with the plaintiffs who filed the lawsuits, according to a court document signed by Judge Kathryn H. Vratil.

The settlement could contribute to a fix for hot fuel in which pumps adjust the amount of fuel pumped depending on its temperature. But details of the settlement, which would apply to all the class-action lawsuits filed in various states, weren’t available. It still has to be approved by Judge Vratil before taking effect, the Star reported.

“I can verify that a preliminary settlement has been reached in the temperature-correction cases around the country,” said Kayla Macke, a spokeswoman for Shell.

“The settlement agreement is designed to fully resolve the cases against the parties to the settlement.”