It is likely a spike will happen tomorrow. We saw the averages in most areas go up over the weekend, and we are still in Spike territory in two areas. Fill up before it goes up tomorrow. Indiana and Ohio will see $2.69-2.75, Michigan and NW Indiana will see $2.79-2.85.
Month: August 2010
Comment on Monday’s prediction: I am surprised to see a price re-set yesterday, so I was WRONG!
Friday, August 27, 2010, 9:00AM: After yesterday’s hike to $2.69, stations in Standale are already at $2.64 this morning. Here’s why — if you own the Clark station on Lake Michigan Drive, you saw the price hike by Speedway yesterday to $2.69, and you also looked at your books and if you use my spreadsheet, calculated the 0-cent margin price as $2.41 and the standard 20-cent margin price of $2.63. You thought, “Hey, I can sell gas for $2.64 instead of $2.69, still make the standard profit, and hopefully tempt drivers to come into my convenience store and buy some high-margin pop and snacks.” The point is that this is the latest in a decade-long series of attempts by Speedway to raise its margins on gasoline, and it just never seems to stick, as long as their is sufficient competition. Meanwhile, not expecting a price hike, I haven’t been urgently looking to fill up, despite being near 1/4 tank, so I went to Costco last night and bought gas for $2.59.
Comment on the August 12 prediction: Prices have been falling slowly but surely, so the prediction was CORRECT.
Monday, August 23, 2010, 9:00PM: Continued weakness in the energy markets and the stock markets means lower wholesale prices, and still lower retail prices. The 0-cent margin price this evening is about $2.38, so I am predicting more price cuts and no hike for at least the rest of the week. — Ed Aboufadel
Comment on the August 2 prediction: Prices rose to $2.85 in the Grand Rapids area on the 3rd, so the prediction was CORRECT.
Thursday, August 12, 2010, 10:00 AM: Our story so far this week: On Tuesday, the Federal Reserve made a decision about buying treasury bonds, which signaled to investors that the economy is not doing as well as they had hoped. (And it was no surprise to businesses who are having trouble getting loans from frightened banks, or the unemployed.) The stock market proceeded to shed 400 points between Tuesday, Wednesday, and Thursday so far, and, of course, energy prices followed. Wholesale gas prices have dropped 18 cents in the past week, putting the 20-cent margin price at about $2.73. With retail prices in the $2.69-$2.85 range right now, we are set up for some nice price drops over the next few days, where there is competition in the neighborhood. Best place to buy gas will probably be Lowell. — Ed Aboufadel
Prices are poised to rise again tomorrow. I don’t have enough time to give it thorough enough analysis to predict a price, however. If you are close to needed gas, it would be a good time to fill up tonight.
Monday, August 2, 2010, 2:15 PM: Price hike predictors, including myself, see what is going on in futures and wholesale market, and it is time to fill the tank. We have wholesale prices rising, to above $2.10, and that corresponds to retail prices with the usual profit of around $2.89. With prices everywhere below $2.79, that’s a recipe for a price hike. I’ll fill up tonight. — Ed Aboufadel