Another Screwy Price Hike

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.

Updated: May 15, 2012 — 2:09 pm

8 Comments

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  1. Im so tired of big oil,with oil now seling for 93 a barrel gas should be 2.99 a gallon,I want to know why the governent doesnt break up the monopoly and requlate the price of gas.So glad Im retired because I wouldnt be able to afford the fuel to get to work,wish I could go back to the sixtys (butch)

  2. ChrisDG74, Cincinnati, OH

    In the northern Cincinnati suburbs, the spike already appears to be crumbling.
    Stations that went to $3.79 Monday, were back down to pre-spike or near pre-spike prices.
    $3.52 has made its return on my route to work.(45240 zip)

  3. If you check out this chart, one can see, that even giving the process two weeks for the lower crude prices to make it through the system and begin showing up at the pump, we should be in the mid $3.30’s in Indiana and Michigan. NOT the $3.70’s. I don’t know about you, but I could use that 40 cents per gallon.

    http://www.IndianaGasPrices.com/retail_price_chart.aspx?city1=Indiana&city2=Ohio&city3=Michigan&crude=y&tme=6&units=us

  4. Diether Haenicke

    I was also unable to access this website on Monday. Maybe Speedway staff was screwing with us and executed a denial of service attack on this website ( http://en.wikipedia.org/wiki/Denial_of_service ). You’d think Speedway has better things to do than care about our conversations on this website, but maybe they’re changing the game just to get a laugh out of our confusion. I’d check the server longs and see if you can trace any hits back to Enon, Ohio, home of the “fourth largest chain of company-owned and operated gasoline and convenience stores in the United States.” I think we need to add a 10¢ summer surcharge to The Spike Line™, in addition to completely ignoring the rack adjustments. Notably, the hyperlink for Speedway’s “Code of Business Conduct” on their website is invalid.

    Not working today is the Chicago spot on Bloomberg’s website. It is still displaying the price from yesterday: $2.9441 (down 2.49¢). That price is only 2.39¢ above where it was when I last posted on May 10.

    Regarding Monday’s reset, Patrick wrote: “Gas prices spiking in areas of Michigan, Indiana, and Ohio today. Justified? Not really. Don’t expect it to last long, folks.”

    Today’s headline from Patrick: “EIA: Crude inventories rise to highest since 1990, gasoline inventories fall again”

    New York June WTI crude oil is currently $92.60, down $1.38.

  5. Diether Haenicke

    It’s more funny this way:

    1. Go to http://www.speedway.com/aboutUs/

    2. Click “Code of Business Conduct”

    3. ERROR: could not be found

  6. The problem’s solution has been staring us in the face since all this started 20-25 years ago. Unfortunately, when you have ‘consumers’ filling up for 20c/gallon more and ‘going inside’ while they have the choice to do neither…

  7. ChrisDG74, Cincinnati, OH

    Turbo46032

    —-Exactly. I watched s station by my house: They jumped to $3.79, along with the Greedway across the street Monday. Tuesday, the came back down to $3.57. Greedway stayed at $3.79, and they were STILL doing more business. So, the other station went back up to $3.79 yesterday. Nevermind that every station, except for 1, around them is in the $3.50s. And that 1 is another Greedway. (Most) people are just stupid. I guess they want their free cup of coffee every 30 fill-ups.

  8. That is part of the problem. Zone pricing is getting to be even more frustrating than the spikes themselves.

    Compare Carmel IN with Tipton IN. I drive thru Tipton occasionally and it is amazing that they seem to have lower prices than we do. Then the pattern changes…

    Finally, they’re getting good at holding prices up longer regardless of crude. I’m betting on a 3.99 Memorial Day which won’t be a huge hike since nearly everyone around me is in the 3.80’s as it is…

    Bottom line. 20 years ago we never thought much of ‘Dime Thursdays’. Why are we surprised now?

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