Comment on the May 20 prediction: We hiked on May 22 to $3.89, so, unfortunately, CORRECT.
Wednesday, May 30, 2012, 2:30PM: In late March, wholesale gas prices of about $3.30 in the Midwest corresponded to a hike to $4.15 in Michigan. This afternoon, prices keep tumbling at the wholesale level ($2.73 this afternoon), which, if it persists, means retail prices could drop below $3.40. The lowest right now is $3.50, and we’ve got prices in the $3.70’s in the certain places in Grand Rapids. I don’t see any price hike coming for the next several days. — Ed A.
No predictions until next week, but Gas Game reader TimmP put together a nice graph demonstrating the recent push by Speedway and friends for higher margins. (And, as other readers have noted, without complete success). Thanks, TimmP:
And this seems like a good time of year to remind you of how gas taxes vary throughout the country:
Have a good weekend! — Ed A.
Sunday, May 20, 2012, 2:30PM: We are pretty much in the exact same spot we were a week ago. After a price hike that reached higher than usual, one that was not embraced universally by retailers, retail prices have fallen to equal to the cost to retailers (estimated at $3.67). Last Monday, we got a price re-set, although re-sets usually occur when prices are a dime below cost. Since Speedway and friends are being more aggressive lately, I am anticipating that they’ll try again on Monday or Tuesday, to either $3.79 or $3.89. The wildcard is that the price of oil dropped 5% last week, but that didn’t affect wholesale gas prices in the Midwest. (NYMEX prices dropped a dime since last Sunday.) Nevertheless, I am going to fill up Monday morning at $3.65 or so, predicting a hike. –Ed Aboufadel
Comment on the May 4 prediction: Prices dropped considerably, as predicted, down into the $3.50’s, so that was CORRECT.
Tuesday, May 15, 2012, 2:15PM: But I missed the price hike that has been in progress the last 24 hours. Updating my spreadsheet over the weekend, I saw a chance of a price hike due to an 18-cent rise in wholesale prices from May 7 to May 11, but things were so out-of-whack at $3.99, and there were indications that this week would be weak for the stock market, so I decided not to post and not to predict a price hike. By noon Monday, when I was driving around and still saw mostly numbers in the $3.60’s, I thought I made the right decision, but by the end of the day, it was clear I was WRONG. This is another one of those screwy hikes, though, that not all stations embrace, and I bought gas for $3.71 this morning at the Meijer in Standale. (They are now up to $3.87.) Retailers are paying about $3.67 for gas today, and they’ll go down to 10 cents below that before a hike, so that’s why there wasn’t a rush to re-set to $3.89. $3.89 represents a price restoration with a higher margin than usual, but then, so did the last few hikes.
Looking ahead, you should seek out places where the price hike didn’t hold. Will Speedway’s attempt to raise margins with bigger price re-sets continue and be successful? We’ll see.
Comment on the April 28 prediction: Last time, I wrote, “That feels like one of those situations where some time next week, there will be a price reset ($3.89 again?) that all the stations agree to almost immediately.” That is what happened on Wednesday, although the new price was $3.99. I’m going to score this CORRECT.
Friday, May 4, 2012, 9:30AM: We appear to have entered one of those periods again when Speedway and friends try to increase their margins, leading to price hikes 10 cents higher than typical, and Wednesday was another example of that. Good news for us motorists is that Chicago wholesale prices have tumbled 20 cents since Monday, and my estimate of the price to retailers today is $3.59. Historically, retail prices can get to 10 cents below cost, $3.49 in this case, so we have a long way down to go from $3.99. Count on prices dropping considerably the next several days. — Ed Aboufadel