Prices are lower all around us, what gives?!
Saturday 20 Sep 2008 | Posted By Patrick | Predictions
Come on Grand Rapids! Hastings is $3.82, I was there last night. Lowell is $3.87, but Grand Rapids still isn’t any cheaper than $3.95! Honestly now… Lowell and Hastings stations aren’t much different than stations in Grand Rapids… they likely bought their fuel from the same rack as the stations from Hastings, but GR is STILL 15-cents higher per gallon! It’s been several days now and it seems no one wants to lower their prices, and average COST today is STILL $3.66! Prices have remained the same on the wholesale market, so come on! I’m not asking $3.66 overnight, but a penny lower every day!? This gets frustrating in times like this. Stations on average are making a margin of 34.6-cents per gallon. That’s a nice chunk there… and like I said, I’m NOT asking stations to make no money… but someone STEP UP and bring prices down. I think that if there one station or a chain of stations that would be consistently the first one to make bold steps lower how much positive publicity they could get from TheGasGame… but hey, that’s probably not enough, is it?
IKE UPDATE: Hurricane Ike is gone, but refineries are still closed, the worst off was likely Shell’s Deer Park, TX refinery that fell victim to a lot of rain. Damage is still minimal, but there are some light repairs necessary. STAY TUNED to the Refinery Status page to check on how restoration is going. ExxonMobil also reported water damage to its Beaumont, TX refinery. In the mean time, the massive 567,000bpd Baytown refinery is continuing to make progress towards a restart. Marathon had also said that their 76,000bpd refinery had been restored electrical power.
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I was up north of Muskegon on Friday and at the town of Rothbury it was 3.78 a gallon.
Lowell is ALWAYS lower than me (Rockford) and I am always higher than G.R. The Mobil station 2 miles north of me (14 Mile & Northland Dr) is ALWAYS 10 cents cheaper than Meijer, BP (131 & 10 Mile) and downtown Rockford.
you were asking why grand rapids is higher than everyone else
well i am not sure if you know this or not
but i read a online report they did when they investigated gas prices
and how they are set
the refinerys set the price according to demand
and they have “price zones”
a zone can be several gas stations in a small area or as few as 1 gas station
most oil/refinery companys have about 150 to 200 price zones nation wide
thats why here in my area (st louis mo)the gas is 3.69 in fenton which is south of st louis but only 3.59 in north st louis
the rack prices can have several small(+or-.10 to .20 cents) variances over a large metropolitan area depending were the actual gas station is
the refinerys/oil companys say they have to do this to keep the volume within a certan range to maxamise profits
in my opinion its a type of price fixing because the refinerys controll this price and individual gas stations have no say in this
Brian: The “price zone” situation that you are referring to only applies to stations that are owned by an oil company and leased to a dealer. The dealer pays monthly rent and whatever they decide to charge him for gas deliveries (not actual rack prices).
In a way it makes sense, real estate prices and taxes are going to be different in different parts of a big city and from city to city. They should charge more in the areas that cost more to be in. The real question is if they should charge more per gallon or in rent. Rent seems more fair to the dealer.
But, we don’t have that problem in Michigan. There are very few stations that are owned by oil companies and leased to dealers. I can’t even think of a station like that, but I know there are a few in Detroit.
The oil companies want as little to do with the retail part of gasoline as they can. They prefer to only deal with companies like ours referred to as Jobbers that own and/or supply multiple stations. That way, we deal with 99% of the problems and rarely have to call them. We only see someone from the oil company at a station less than 2 times per year.
Here in Kalamazoo its 3.75.. Battle Creek is 3.85.. Why is that?