Comment on the November 21 posting: Much of that commentary was about the stock market. As soon as that posting hit, the market started climbing, with the Dow going from 7400 at 3PM that day to its close near 8600 today. OK, readers, that’s the second time this fall I’ve been a contrary indicator for the stock market! (See October 21.)
Wednesday, December 3, 2008, 10:00 PM: The hike last week to $1.75 was the first price hike in three months! The hike was curious in a number of ways. First, Speedway initiated it on Thanksgiving Day. Second, using our old friend the 20-cent margin, it was kind of a lame hike, as $1.89 would have better fit my mathematical model. Third, at least along Lake Michigan Drive, the hike was not embraced by Big Red’s competitors. So, after the dramatic changes of the past three months, I am sitting back and trying to determine, since we are back to prices when the Gas Game was started, are we going to go back to price behavior from six years ago. I don’t know yet.
I am pretty certain, though, that gas prices are going to stop going down soon and start turning up. Why? Because they do this almost every year in late December or early January. Some history:
late 2007: prices vibrated around $3 a gallon and then took off in the winter and spring of 2008.
late 2006: prices danced around $2 a gallon and then made it to $3 by the end of April 2007.
late 2005: $2.03 on December 1 of that year. $2.95 by late April.
late 2004: $1.75 after Christmas, $2.43 on April 4, 2005.
late 2003: $1.48 in December, rising to $2.15 by June 2004.
late 2002: $1.21 in December. By March, $1.80 a gallon.
The low in the area this evening is in Allendale ($1.56). I suppose we could go lower, but probably not much more. Maybe even a price hike on Thursday? (That’s not an official prediction!)