Sunday, December 3, 2017, 11:00AM: Back in early September, oil was trading at $48 a barrel, and price reset in Michigan to $2.79 on the 5th. On Friday, oil was trading at $58 a barrel, and gas prices … as low as $2.19 in Wyoming. But, I also saw a $2.69 yesterday in Lansing, and everything in between in the southern part of the state the past two weeks. So, what’s going on? For one, retail gas prices tend to drop in the fall, typically bottoming out in December, as we switch from summer to winter gas. Also, we had a spike in wholesale prices in the first week of November, related to some temporary shortages that have been worked out of the system, and it looks like some of the stations are having a “clearance sale” now to right their books. One other consideration is that ethanol, which makes up 10% of what you put in your tank, has been dropping in price the past few months. Looking ahead short term, I think we reset across the board this coming week, in the neighborhood of $2.59. Longer term, I suspect we’ll be starting our winter price climb this week, as gas prices catch up to oil prices. -EA
Comment on the November 1 prediction: Well, that was WRONG, as prices didn’t rise in Michigan until a week later. Weird, given the hike in Indiana.
Tuesday, November 21, 2017, 7:00PM: After three hike days in October, it has been a quiet November with only one hike day so far. The Midwest shortages seem to have sorted themselves out, and wholesale prices have been dropping steadily since the beginning of the month. I would say that I’m not seeing a hike on the horizon, except that gas is $2.20 in Sparta this evening, $2.33 in Cedar Springs, and $2.35 in Wyoming, all below the 0-cent margin price I calculate. So, they could try to reset across the board to $2.59 on Wednesday, or Big Red might give us a Thanksgiving treat. No prediction at this point, but keep an eye out if a hike emerges tomorrow morning. – EA
Comment on the October 29 prediction: Pretty much CORRECT, as prices rose to $2.69 on Monday.
Wednesday, November 1, 2017, 9:30PM: Wholesale prices in the Midwest are a runaway train this week, and we’ve already seen a jump in Indiana today. Michigan should see prices rise on Thursday, somewhere in the $2.79-$2.99 range. What is going on? A huuuge growing mess of shortages, according to Reuters, and no obvious relief in site. Fill up again! -EA
Comment on the October 24 prediction: A weird WRONG as gas prices did not jump in Michigan. More in the new prediction …
Sunday, October 29, 2017, 6:00PM: Regular readers know that along with my commentary on west Michigan gas prices, I keep an eye on Fort Wayne, Indiana prices, since that is where I graduated from high school. Typically, when prices jump in Michigan, it is a day or two later that a similar hike occurs in Fort Wayne. So, I was rather puzzled that my prediction last Tuesday worked for the Hoosier state, with prices rising there to $2.69, while a similar hike did not occur in Michigan. Adding to the puzzlement is that oil prices continued their slow-but-steady climb the past week, and we have a report on Friday of “a sustained gasoline supply shortage in the Midwest”. With my spreadsheet screaming that we are in price-hike territory still, what else can I say except fill up Monday morning and expect something like $2.75. -EA
Comment on the September 21 prediction: Nah, we didn’t get a hike until the following week, so WRONG.
Tuesday, October 24, 2017, 9:30PM: Wow, it has been a month since my last posting. I guess I have been busy. So has energy prices, with oil up more than 5% in a month, and gas prices have followed. With the latest rally for Chicago gas today, perhaps motivated by the latest in the blow-off stock rally, we are back in price hike territory already, with a hike probable for Wednesday or Thursday. Looks like $2.69 or $2.75, depending on Big Red’s mood when he gets out of bed. -EA
Great Lakes region looking about ready for a price reset as we are solidly under the Spike Line. I’m thinking $2.499 for Ohio, YMMV. We could go as early as Friday morning.