Why I filled up tonight, and why I’ve been WRONG lately

Comment on the August 13 prediction:  Nope.  No hike, so the prediction was WRONG.

Tuesday, August 19, 2014, 9:00PM:  OK, I have been Mr. WRONG the past two months.  What’s going on?  Let me at least walk you through the last two predictions.  On August 5, the “Chicago CBOB spot price” that I find on the Internet was $2.61, which translated to a price to retailers of $3.29.  Since the retail price in Standale was $3.43, I thought we were safe.  But then next day, the spot price rose 10 cents, and then another 9 cents the next day.  Ta da, price hike on August 7.  On August 13, CBOB was $2.77, which means a price to retailers of $3.45, which was the retail price in Standale.  Sounds like the recipe for a price hike.  But, the next day, CBOB dropped 9 cents, and then another 12 cents over the next few days.  Ta da, no hike.  And that brings us to today.  CBOB jumped 6 cents today, and the price to retailers equals the retail price in Standale.  If filled up tonight, and I’ll risk further public ridicule and predict a price hike for Wednesday.  $3.55? –Ed A.

Posted in Commentary, Predictions

#TBT Tank Banquet Thursday

Comment on the August 5 prediction:  One of my WRONGest predictions ever, as a jump in wholesale prices yielded a hike on the 7th.

Wednesday, August 13, 2014, 6:30PM:  After last week’s price hike, wholesale prices bumped more, while retail prices did their typical slow drip lower.  Looking at tonight’s numbers, we are right in the price hike zone, so I am going to take my car out for a meal on Thursday morning.  Expected new price in Michigan:  $3.69.  –Ed A.

Posted in Predictions

The only hikes expected will be at football practice

Comment on the July 26 posting:  Wasn’t really a prediction, and prices rose on July 29 and 30th to what I feared.

Tuesday, August 5, 2014, 3:30PM:  With financial markets showing weakness, energy prices are starting to slip, too, and we are in no danger of a price hike this week.  That’s a prediction.  But, for a little added value, here’s a recent interview with Gregg Laskoski of GasBuddy, giving a good explanation for the gas price action we see in the Midwest.  — Ed A.

Posted in Predictions

Silver Gas Tank Playbook for the Week

Comment on the July 14 prediction:  We got a hike, but not until Thursday the 17th, as prices fell hard that week.  I’m not going to complain, but I was quite WRONG in my prediction.

Saturday, July 26, 2014, 9:00PM:  It’s been a mild summer, weather-wise, and gas price-wise.  Is there a connection?  I don’t know, but let’s figure out the playbook for the coming week.  Using a Chicago CBOB price (i.e., a wholesale price without taxes, etc.) on Friday afternoon of $2.64 a gallon, that translates to a price-to-retailers of about $3.32 a gallon.  That calculated price is about what the retail price needs to be to trigger a hike.  Here is the Grand Rapids area, we are down to $3.32 in Sparta, but mostly in the $3.40′s elsewhere.  So, if wholesale prices are stable, I think we’ll see retail prices drift down in the $3.30′s, followed by a hike on Wednesday or Thursday back to around $3.65 (the price at the last hike).  If wholesale price drop, then we might not get a hike, but if those prices rise, we definitely will.  Too early to make a solid prediction, so this is just a commentary. –Ed A.

Posted in Commentary, Predictions

Wrong last week, but I doubt I’ll be wrong this week — fill ‘er up!

Comment on the July 5 prediction:  No hikes at all last week, so I was completely WRONG.

Monday, July 14, 2014, 8:00PM:  Just so you know I practice what I predict, I topped off my tank twice last week, thinking a price hike was imminent.  But, due to sliding wholesale prices, there was on-going pressure to keep retail prices down.  However, wholesale prices have stabilized, and I’m seeing gas in the $3.20′s in Fort Wayne, and $3.30′s in Lowell, Michigan.  By my calculation, the price to retailers is about $3.40.  So, I’m going to fill up Tuesday morning, expecting a hike with a new price at least $3.69. — Ed A.

Posted in Predictions

What Uber Might Tell Us About Gas Pricing

Comment on the June 22 prediction:  For Michigan, I was CORRECT about the hike, which occurred on Wednesday, June 25, but we only went to $3.95, the hike didn’t occur in some other states, and what was I talking about with the “holiday weekend coming up” a week early?  So, give me a 1/4 WRONG.

Saturday, July 5, 2014, 10:00AM:  There has been a lot of discussion on the web site lately about whether or not the way Speedway and friends price gas in the Midwest is to the advantage of consumers, and whether or not we have a “free market”.  I don’t know the answer to these questions, but I do know that Midwest gas pricing can provoke strong emotions, and something I read recently about Uber suggests why.  For those who don’t know, Uber “makes mobile apps that connect passengers with drivers of vehicles for hire and ridesharing services.”  Part of the way it works is that pricing is very flexible and can change from minute-to-minute or day-to-day, depending on supply and demand.  Arguably, it is a clear example of a “free market”.  But, Tim Harford, “Undercover Economist” of the Financial Times, wrote the following recently in Wired UK:  “Such flex-pricing worked for Uber but we can only take so much.  It turns out that prices that stay put aren’t a relic of hand-painted menu boards.  The real reason that prices stick isn’t technological; it’s psychological.  An ever-shifting landscape of prices makes us feel exploited, if not motion sick.”

So, whether or not we are actually being exploited by Speedway and friends, it sure feels like we are.  And that’s why we try to win The Gas Game.

In terms of winning the game, prices are all over the place right now in the Midwest:  $3.56-$3.79 in the Grand Rapids area, $3.90s north of Ann Arbor, $3.37 in Lima (Ohio), around $4 in Chicagoland, etc.  Wholesale prices have been slipping the past two weeks.  Based on my calculation, the price to retailers in Michigan right now is close to $3.52.  So, I think we are setting up for a system-wide reset by Tuesday, in the neighborhood of $3.85 in Michigan, with similar prices elsewhere.  That’s going to look ugly in some places, such as much of Ohio. –Ed A.

Posted in Commentary, Predictions
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We enjoy predicting and trying to further our knowledge in the gasoline and oil industry. Our ultimate goal is to "win" the game of price hikes and to accurately predict hikes.

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