3:00 PM: If you have been reading my predictions closely this month, you’ll notice I have been a week off. Oct. 9: prices will fall soon to $2.50. That didn’t happen until Oct. 21. Oct. 14: perhaps some dramatic drops. That didn’t kick in until after Oct. 20. Oct. 19: Could we go as low as $2.25? That didn’t happen until this weekend. Last Tuesday: price hike this week. That didn’t happen … yet, but it given my track record in October, it will happen this week, right? Actually, the numbers bear this out, as the 20-cent margin price is $2.37 and we are more than a dime under that in a lot of places. Expect Speedway and the rest to reset prices before Friday. Nope. Prices kept falling, down to $2.01 by Monday morning in Wyoming. WRONG again.
Month: October 2005
1:30 PM: I predict a price hike on Wednesday or Thursday. We’ve seen prices fall dramatically this month, with the last hike being to $2.94 on September 30. Today, you can get a gallon in town for $2.37. This drop in retail prices has followed the drop in NYMEX prices, but retail prices have remained above the 20-cent margin price I calculate, reflecting a signifcant difference between New York and Chicago prices. I am not be able to tell what the “fudge factor” is right now, but based on the Department of Energy web pages that compare New York vs. Chicago wholesale prices, it is at least 8 cents. With NYMEX up today, the numbers are lining up for where a price hike could occur, so it probably will. My guess right now is a new price somewhere in the neighborhood of $2.49. I practice what I predict and filled up Thursday morning for $2.35. That was the WRONG thing to do, as prices got as low as $2.21 on Sunday after no price hike.
11:30 AM: Still lower prices on NYMEX means still lower prices at the pump. Unless Hurricane Wilma decides to go after Texas and Louisiana, you should see cheaper prices through the weekend. Could we get as low as $2.25? Prices continued to fall, below $2.40, so the prediction was CORRECT, but the wish for $2.25 was a pipe dream.
2:00 PM: NYMEX futures prices have fallen another 14 cents this week. Right now, that puts the 0-cent margin price at $2.19 and the 20-cent margin price at $2.41. However, we know that prices have been staying above the 20-cent margin price the past few weeks due to the “fudge factor” difference between New York and Chicago prices that is probably still due to hurricane damage. Nevertheless, prices will continue to fall, perhaps with some drama, this weekend and Monday, so don’t rush to fill up. Prices continued to fall, slowly but surely. The morning of 10/19, you could buy gas for $2.47. The prediction was essentially CORRECT.
NYMEX futures prices have fallen 44 cents a gallon since September 28, and while I understand this hasn’t been translating very quickly into cheaper wholesale prices, finally this weekend we are beginning to see this reflected at the pumps. $2.76 is the cheapest in town right now in Wyoming, although Meijer’s in Standale last night gave me a coupon for 50 cents off per gallon, allowing me to fill up today at $2.31 a gallon! I’m going to predict that prices continue to fall this week, and somewhere in the area, gas will be $2.50 a gallon by Thursday morning. I guess I was a bit ambitious — prices have been falling, but we didn’t get to $2.50, so WRONG.
NYMEX futures prices have drifted lower since Friday, but retail gas prices have been slow to follow. One of my “friends in the industry” writes me today to say that wholesale prices from the hub in Muskegon have been running 20 to 25 cents ahead of NYMEX futures, which would explain why prices have hardly moved this week. So, it is coin flip to me about what happens to prices the rest of the week: they could head towards $2.50, if NYMEX is to be believed, or stay near $2.90 if wholesale prices really are out of whack with NYMEX. As for me, with only a quarter tank, I’m filling up tomorrow morning, maybe down in Wyoming.At some point in the future, I will comment on the proposal to only allow price hikes on Monday, but you can read about it at this web site.
There was no price hike, but prices fell very slowly.