I filled up as a precaution, should you?
Wednesday 24 Sep 2008 | Posted By Patrick | Predictions
With prices falling (and rightfully so) to the $3.60’s (suburbs) and $3.70’s (GR area) and much lower in other parts of the state, is a hike likely anytime soon? It could be… chances are really 50/50, but I personally filled up just in case so I wouldn’t get caught losing too much money if prices came down. If any hike occurred, it wouldn’t be more than $3.79 or so.
Nationally, there are still major refineries without power and that are closed in Texas and Louisiana. Refineries operated at a record low 66.7% of capacity last week, as reported by the Department of Energy in its Weekly Report.
We’re hurting folks, but not as bad as those dealing with REAL GASOLINE shortages in Georgia, Tennessee, areas of the Carolinas, and the upper South. They are encountering major supply issues as refiners are slow to pickup the pieces.
Nationally, I expect prices to rise up-to a dime more before things calm down. I think realistically, we won’t be back to normal until mid-Winter. Supplies of gasoline in storage are at a record ALL TIME LOW dating back to 1969. Folks, this is pretty unprecedented.
Other news, TheGasGame.com will be making a splash onto Washington, D.C. airwaves as Ed was called for a radio interview! Cool! We are also looking to add another major source of information (this is huge and I’m quite excited about it). The source may provide inside information to the oil/gasoline industry and will fuel my curiosity to learn more, which will ultimately benefit our audience here.
Be sure to stay tuned to the REFINERY STATUS page as well. It will be updated as necessary or as new information becomes available. It is quite accurate at this time.
Patrick
Loading ...
Retail prices still have quite a way to come down (unless wholesale goes up) before you need to worry about a price restore. We had another 7 cent drop last night.
People are starting to be a little less cautious about dropping their prices. I saw several stations drop 5 cents yesterday and 10 more today, I wouldn’t be surprised to see another 5-10 tomorrow.
If wholesale prices behave, I have a feeling that you will see retail prices move downward pretty quickly next week. The $3.50’s are not unrealistic today.
It’s kind of interesting to look at the gas price temperature map on Gas Buddy right now. It really shows how dependent the Midwest, Georgia, etc are on the Gulf States. It seems ironic that Texas is the State with the problem, but yet they have some of the cheapest gas in the country. But, what is happening is they get first dibs on any gas that is getting refined in their State, and we get whatever is left over that they don’t need. The farther away that you go from Texas, the more pipeline stops there are for other States to take their piece of the supply.
I was driving back from Lansing today and saw that the stations in Lansing along Saginaw Hwy off of 96 were all around $3.66 a gallon. The Speedway of off Wright Hwy in Grand Ledge was at $3.58 a gallon (this speedway actually drops prices faster then others and raises last!). The Speedway and BP in Portland were at $3.63/gallon. The stations in Ionia around Meijers were sitting at $3.77/gallon.
I think it looks like prices will drop…see what tomorrow brings!
It’s sad that $3.55 is a price to cheer about. But that is what it is in Kalamazoo/Portage along Westnedge and I-94 interchange. Some others seem to be following suit, and some at $3.57. But there are others for the uninformed still at $3.79. Go figure.
Retailer - Thank you very much for your input and updates. It is appreciated!
What’s sad is that in Battle Creek, the lowest price I saw today was $3.84.
Meantime prices in Kalamazoo are $3.55-3.62. Prices in Kzoo drop 5-8 cents a day, while in Battle Creek maybe a penny a day.
Talk about gouging. Raspberries to the BC stations.
Thanks for the updates retailer.
There are plenty of stations below $3.80 in BC now.
Define gouging for me please, and being higher than another town doesn’t count.
Based on today’s rack prices $3.559 is a 8.9 cent markup, $3.629 is a 15.5 markup, and $3.799 is 31.5. Gas stations normally average between 10-15 cents markup for the month, but with our higher expenses now, we really should be in the 20-25 cent range. So, $3.559 is too low (they will be loosing 2 cents per gallon on a credit card sale), $3.629 is a bit low, and $3.799 is about 6 cents too high based on today’s rack (is that gouging?).
I was thinking that we were getting to the end of the wholesale drops, but the market is down about 9 cents right now, so maybe not. Regardless of how fast they do it, retail prices are still coming down. If the market stays down and that gets passed on to the rack, then you will see a lot more prices in the $3.50s next week. If we don’t get a drop tonight or Monday, then we might be getting to the point of a Speedway restore on Tuesday, probably to $3.699.
Bought gas today for $3.58 in Three Rivers, MI, but it’s still in the high $3.70 range in GR. If Three River’s dealers are losing money at $3.58, then how are their lights still on? Face it, they are making a “real” profit at $3.58, and GR dealers are trying to not have to lower their prices that much, while praying for a oil barrel increase so they don’t have to. They figure if they drag their feet and we don’t “DEMAND” lower prices, they can get away with the greater profits. Tell me again what gas was selling for when the oil barrel price months ago, is where it is now?
I’m saving .30 a gallon simply by using a Exxon/Mobil card and putting my gasoline purchses on that. I also use the lil Mobil tag thingy…er speedpass. Every little bit helps and this is a big helper!
It also has no yearly fee on the card…I thought it was a great idea and I went for it. We shall see how it goes.
And I also pay off the balance every month so the snidley whiplash oil/CC company doesn’t make any interest on it either.
Dan in Rockford
P.S reading this I sorta sound like an advertisement for Exxon/Mobil…no it isn’t. They have a station right behind my worksite on Chicago Drive and its just handy. Also one on 10 Mile and US131 on the way home too. ANything to make life lest costly and more able to afford LOTTO is a good THANG!
Daniel G: The 30 cent deal for Mobil sounds good, but when prices are above $2.959 the Marathon and BP cards are a better deal. Plus, Marathon, BP, and Sunoco are always better for non gas purchases at the station.
I did a breakdown of the different card programs out there. I left off Citgo and Speedway because Citgo’s website didn’t say anything about a gas discount and Speedway went from having a 4 - 8% rebate to just giving an extra 40 rewards points (what a deal…), but they are giving 5 cents off for a limited time.
Card Savings Savings @ $3.799 Inside
Mobil (first 60) $0.15 $0.15 1 - 2%
Mobil (after 60) $0.30 $0.30 1 - 2%
Marathon (first 60) 10% $0.38 10%
Marathon (after 60) 5% $0.19 5%
BP (first 60) 10% $0.38 10%
BP (after 60) 5% $0.19 5%
Shell 5% $0.19 1%
Sunoco 4% $0.15 4%
Meijer $0.05 $0.05 No
The higher above $2.959 that prices are, the better it makes the % discount cards, and the farther below makes the Mobil better. At $4.009 10% is .40 and 5% is .20, at $2.009 10% is .20 and 5% is .10.
Do you want to bet on which side of $2.959 is most likely over the next year?
Wow, the spacing on my card breakdown was a lot better before I submitted it. Sorry that it is hard to read now.
Cruiser: The price of crude isn’t the only factor in the price of gas. Like every other product, the price is determined by the cost of manufacturing and by the law of supply and demand.
Earlier in the year when Crude was so high, it caused prices to go up. But, now we have a pretty large shortage on gas that caused prices to go up. In theory, when there is a shortage of a product, raising the price will slow demand to until supply can catch up. But, it doesn’t always work smoothly with gas, since when you tell people there is a shortage they tend to panic and buy extra instead of conserving and only buying what they need.
The weak economy is bringing the price of crude down. The combination of cheaper crude and more refineries / rigs coming back online is bringing the price of gas down, but the remaining shortfall of gas is slowing the pace of the drop.
Thank you Retailer…great insight. But I did the Mobil because of the conveniece of their stations…for the most part anyway. I work at the railroad yard along Chicago Drive and our shanty is right behind the J&H Station. I only purchase gas and lotto at the stations anyway so the rest of the stuff they have for sale is on no consequence for the most part…cept maybe for a good deal on a Snickers now and again!
I enjoy your websight and anything to shed some light on what we have in the way of gas prices is always interesting.
One thing I watch here at the railroad…the gas-o-hol going in and out of West Michigan. A recent surge thru GRP of empties for the alcohol plant at Sunfield is one thing I’ve seen this week. And we get alcohol for Muskegon on an almost daily basis. Interesting that they ship in alcohol from Indiana and Minnesota for Muskegon while they make it in Sunfield and THEY ship out to various points in the east. Go figger that one!
I see fuel prices dropping…and I don’t think its a good thing for the most part. Price of gold goes up today, Asian markets dive in tonites trading. Europe should be interesting overnight…when you put the economy in the dumper for idiological reason (read Republicans) and no one wants to buy because prices will/might be lower tomorrow…well, bad times soon come. Fuel at any price, when no one has a job…means WHO CARES!
Shades of the thirties on the horizon? I only hope 32 years seniority keeps me off the dole.
Dan in Rockford