Best advice: Go buy gas in Kentwood this weekend

Comment on the June 29 prediction:  Prices rose to $3.75 on June 30, as predicted, so that was CORRECT.  Then, I took a trip out East, and prices rose again on July 5 to $3.89. While my prediction success rate is quite good, I’ll admit that some hikes occur independent of my postings.  The lesson:  if I don’t have a new posting, that doesn’t necessarily mean the coast is clear.

Friday, July 8, 2011, 1:15PM:  The stock market hit a recent low on June 27, and so did wholesale prices as tracked by RBOB and Danaher.  (Thanks for the link, Bill!)  We’ve seen stocks jump 6%, and wholesale prices have gone from about $2.68 to $3.05 (about 14%).  Of course, retail prices have followed, and I got a little worried yesterday when stocks, oil, and gas trading all was up strong.  It doesn’t look like we are going to get another hike today.  The hike on Tuesday to $3.89 was a bit surprising — it seemed to be pushing the margins a bit more than usual — but now with higher wholesale prices, the 20-cent margin price is in the $3.89-$3.99 range.  So, if there was a hike today, it would be to $3.99, and it looks like they decided not to bother.  Have you noticed, though, that prices have stuck for the most part near $3.89 all week?  Looking ahead, a weaker market today will keep a lid on prices.  Hard to believe we have some $3.63’s in Kentwood.  Those prices shouldn’t fall much further, but expect those $3.89’s to fall somewhat over the weekend.  Then we’ll see what happens next week.

Updated: July 8, 2011 — 12:17 pm

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  1. Funny, Rockford jumped to $3.89 on Tuesday and dropped to $3.65 yesterday in a freakish move. Wonder why since they seem to always have the highest gas prices in the GR area.

  2. Amazing how Speedway had gas for $3.41 ($3.38 with speedycard) last night matching the Admiral price, but yet the speedway that was 5 miles down the road was $3.79 a gallon.

  3. That is not amazing at all. Speedway sets the retail high mark (particularly in west Michigan), then individual outlets (apparently with corporate approval) lower their prices to match their nearest street level competitors. If there are no competitors nearby or competitors are not lowering their prices, the price doesn’t fall a whole lot below the high mark. This is why prices on the west side of Kalamazoo (which has 3 Speedway locations) have been higher for years, because the competitors (BP, Shell, Citgo, Meijer) do not price as aggressively as other parts of town.

    Admiral stations around the state appear to be among the low price leaders. Among the 15 lowest prices currently reported in Michigan, 4 are at Admiral stations (Caro $3.369, Lake Orion $3.419, Sturgis 2 locations on U.S. 12 at $3.419). There appear to be about 97 Admiral stations in Michigan. Meijer has 101 stores in Michigan. Assuming all Admirals in Michigan are corporate owned and all Meijer stores in Michigan have gas stations, Admiral might be the third largest gasoline retailer in Michigan, in terms of locations. I imagine Meijer is much larger than Admiral in terms of how much gasoline is sold. With 290 Michigan locations, Speedway has 92 more locations than Meijer and Admiral combined.

    It appears Admiral has a few locations around the state at any time where they sell below cost, and they keep changing those locations. After the prices in Sturgis, the fourth lowest Admiral city is Eaton Rapids, where the Admiral price takes a 16¢ jump to $3.579. The Admiral in the Kalamazoo area had been a low price leader for the entire state until the Thursday, June 30 increase to $3.759. Prices in Plainwell/Otsego have been lower than anything in Kalamazoo County for months at a time, and I think that was due to the 2 Admiral stations in Plainwell. The Admiral in Portage (Kalamazoo) is currently $3.719 while it’s $3.729 in Plainwell.

    Circle K stations in Kentwood and Kalamazoo have also been among the low price leaders, but I don’t know if they are under the same ownership and certainly don’t have the kind of resources to keep up the loss leading that Admiral does.

    At 12:46 p.m. ET, the Chicago spot was down 1.82¢ (0.605%) to $2.9919.

    New York gasoline futures are currently down 2.36¢ to $3.069.

  4. Fort Wayne seems to be in disarray with it’s gas pricing. I have not seen such pricing in years. Usually the stations have a few price leaders and then the rest all fall in line within 5¢ to 8¢. For the last 4 days or so, the ranks have been disturbed. Circle K and Speedway and Kroger seem to be leading with $3.559 and then it is all over the place with a 3rd or more above $3.689. Even Sam’s Club is not the price leader any more. This is very unusual.

  5. I just saw on GasBuddy that the Meijer in Fort Wayne, East side is $3.359. With the Murphy Oil across the street $3.579. This Meijer now is by far the price leader in Fort Wayne. Prices are all over the place. SHOP for your gas and save big in one single town!

  6. Now, this was truly unexpected.

    Speedway began a reset to $3.859 at least as early as 9:49 this Tuesday morning in west Michigan.

    $3.859 also appears to be the price for east Michigan, even though Speedways in some cities (Auburn Hills, Burton, Imlay City, Croswell, Cheboygan) are still at $3.899. For the prior 2 or 3 increases, east Michigan had a Speedway reset that was 5 to 10¢ higher than west Michigan.

    In Indiana, the price seems to be $3.799 (at least in Fort Wayne and South Bend areas.) I don’t know how Kalamazoo got to be the first place to experience Speedway increases each time, but the first report in South Bend/Elkhart wasn’t until 11:12 and 11:25 in Fort Wayne.

    In Ohio, the price seems to be $3.699 (at least in Toledo and Akron). The first report in Toledo was at 10:34 in Maumee. In Akron, the first report was at 10:51 in Massillon.

    New York gasoline futures are currently up a fraction (.95¢) to $3.08.

    The current Michigan average is $3.763 and $3.643 for the nation.

    Again, the Meijer in Rochester Hills was the first in Michigan to match the new Speedway price, as reported at 12:12.

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