The BP gas card used to be one of the best on the market, but not anymore…
Ever since that BP oil spill fiasco in the Gulf several years ago, Americans have given an extra dose of scrutiny to just about anything related to BP. Some people even went so far as to avoid anything related to this oil company… and now they have yet another reason to avoid them. However, since BP provided their multi-billion dollar settlement with affected businesses, gulf states and consumers some of the furor has died down. So, is their card still worth getting to defray the cost of gasoline?
Comparing the old vs. new rewards program…
The old BP Visa card (discontinued in 2012)
There have been a few years where it was rated by Kiplinger’s Personal Finance as the best gas credit card. And guess what? I agreed! If you came to this page before you would have seen my unbiased BP credit card review (I never advertised them but gave rave reviews nonetheless).
Obviously rewards are the most important thing when it comes to choosing a gas station credit card. The BP gas rewards program was:
- 5% rebate at BP gas stations – All BP gas stations earned a 5% rebate. Think about it… on $3 gas that’s a savings of 15 cents per gallon. On $4 gas that’s 20 cents per gallon.
- 2% rebate on eligible dining & travel – I had went to the BP website and read the fine print on their credit card application very closely; for travel this included airlines, lodging establishments, and car rental agencies. For dining it included all restaurants with the exception of fast food.
- 1% rebate on virtually all other purchases – A straight-up 1% on everything else.
- Unlimited – The fine print said “There is no maximum number of rebates that you can accumulate in the program.”
- 10% cash back promotion – During the first 60 days it gave 10% on spending at BP. In terms of a dollar value, the additional 5% wouldn’t total out to be all that much (unless you bought a tanker truckload of fuel) but this offer was still some nice icing on the cake.
Being that the Chase BP gas card had no annual fee, you can see why it was one of the most lucrative given those rewards.
The new BP Pump Rewards program explained
The contrast between the old and new version (which began last year) is like night and day. It went from being the best to one of the worst. Be warned, it’s quite convoluted…
The new program is called “Pump Rewards” but it’s hardly rewarding:
- For every $100 spent at BP you earn a 15 cents/gallon rebate
- For every $100 spent elsewhere you earn a 5 cents/gallon rebate
At first this actually sounds pretty good, right? Well I pulled up the BP credit card application and combed over the fine print. Here are the caveats that come with it.
Trick #1: Rebates can only be applied to one fill-up
This is where people with compact to mid-sized cars are really getting the short end of the stick. Why? Because when you choose to use your accumulated rebates, you can only apply them to one fill-up.
So let’s say your credit card account had:
Earned (1) 15 cents/gal rebate at BP (by spending $100)
Earned (3) 5 cents/gal rebates elsewhere (by spending $300)
Total = 30 cents/gal rebate
If you drive a small hybrid, you’ll be lucky to squeeze 10 gallons in the tank. Redeeming the above (30 cents/gal) would only equal a $3 savings on a 10 gallon fillup.
Based on the above scenario, you would have spent $400 but only earned $3, which is a 0.0075% rebate. Not very impressive, is it?
Trick #2: Max fill-up with rewards is 20 gallons
Okay. The reasons whey BP credit card doesn’t make sense if you have a small car have been covered. But what about if you’re driving a gas-guzzler? Then it must make sense, right?
No, not exactly.
When you cash out your rebate, it will only apply to the first 20 gallons. So that means even if you have a gigantic fuel tank, you may not get the discount on your entire fill-up.
Trick #3: Typically must redeem all rebates at once
The only good thing about the new BP Visa is that you can choose when to take the rebates. When you swipe you credit card at the BP gas pump, it will say:
“Use $xx.xx/G Y/N?”
If you select “Y” then it will apply your “pump rewards” to that purchase. Unfortunately there’s no option to only use some of them – it’s either all or nothing.
The only time your rebate balance will carry-over is when it is more than the current price of fuel minus 10.9 cents (so 10.9 cents per gal. must always be paid).
The Chase BP rewards change is not a good thing. Get out your calculator and play with the above numbers and you will see that even in the best case scenario, the maximum value you can get is the equivalent of 3% at BP and 1% elsewhere (and that’s assuming your tank holds 20 gallons).
There is a statement credit option that is an alternative to rebates at the pump. However if you go this route, the max value you can get is 25% less (2.25% from BP spending and 0.75% for other spending).
Conclusion? The Chase BP Visa credit card is really no longer worth getting. In fact, there are really no co-branded gasoline credit cards that are worth getting for that matter. There are so many other options that reward you handsomely for gas purchases (along with all other purchases) and give you a myriad of redemption options (not tied to a specific gas retailer)
Recommended Alternatives For 2015?
- *Top Recommendation* Blue Cash Everyday or Preferred – Pays you a straight 2% or 3% (depending on which version you choose) on gas at all US stand-alone gas stations
- Barclaycard Rewards MasterCard – If your credit could use some help (if it’s only fair or average) then try for this one. It has no annual fee and gives the equivalent of 2% cash back at gas stations without any limits to how much you can earn. This will be the easiest one to get approved for. They also have a version for people with excellent credit.
- American Express Costco credit card – 3% rebate on the first $4,000 spent on gas at US stand-alone gas stations (including Costco stations). Must be a Costco member to get this.
- Discover it – Gives 5% on gas for at least one quarter per year. Other categories earn 5% too. No annual fee.