Nice weather for ducks this weekend

Comment on the April 7 prediction:  Since I was able to buy gas for $2.09 a gallon in Grandville on Saturday afternoon, clearly my prediction was WRONG.

Sunday, April 12, 2015, 7:00PM:  Not sure why we got such a gas price sale this weekend … maybe it was the wonderful weather.  But here are the numbers:  Chicago CBOB closed Friday at $1.65 a gallon.  Mix in ethanol, taxes, and middlemen, and I estimate that retailers are being charged $2.31 a gallon this weekend.  So, $2.09 is rather perplexing.  How can there not be a substantial price hike on Monday?  I’m going to fill up (again) on the way to work in the morning. –Ed A.

 

p.s.:  Nice Weather For Ducks!

Updated: April 12, 2015 — 7:07 pm

35 Comments

Add a Comment
  1. Two words – Zone pricing. (just a theory of course, feel free to shoot it down)

    I am looking at a gas heat map of Central Indiana and from what my cataract afflicted eyes can tell, it’s a tale of two zones. East of US31 and north there are lots of prices in the 2.1x range, West of US31 and south, not much so.

    So, if way more people are buying at 2.2x and even 2.3x versus 2.1x, in the grand scheme of things Big Oil comes out ahead. At the metro Indy area, if we assume relatively uniform distribution, maybe 1/3 is green and 2/3 is yellow. At the state level there’s a LOT more yellow than green, tho the population density is not uniform.

    It is too simple to think “oh there’s a Costco here so keep prices high around it” or “oh there’s 10 gas stations in a 4 block area so prices have to be low”. If you play this at the state level, and there’s no doubt in my mind they are, it’s pretty easy to fine tune it for maximum yield.

    Just another theory… I wish we had access to actual sale data by volume, not simply prices reported.

  2. I filled up this morning just in case. If I get 70 miles on the tank and nobody in my area has gone up, I’ll fill up again. IT’s getting too close to ignore.

  3. I think you’re right about zone pricing. There’s a reason it’s called The Gas Game – and it’s not just Speedway’s shenanigans.

    Off the topic of gas prices (strictly speaking), but I’m curious about what you all think of the points escalation that’s going on in Gas Buddy land (Over 3,000 points available on a typical day now, over 5,000 once a week)?

    There’s a lot of folks on my local site – long-time users – that are REALLY getting fed up with the changes because of the preferential attention being given to the app users over the website users. First it was the videos, now it’s the challenges being offered to app users.

  4. We’ve spent the last 4-5 days on the south end of Grand Rapids with the lowest prices in the state. I’m not complaining by any means, but there’s something going on around here?

  5. Monday 6PM, and no hike that I can see. $2.04 in Jenison right now. There is some key piece of information I’m missing right now.

  6. The only thing that makes sense to me (and just a theory) is that Speedway/Marathon has all of their refineries running smoothly it seems in the Midwest. Therefore, since they set the price, and oil so cheap they can make it cheaper than the spot (and don’t have to buy it on spot market). Just hoping they aren’t doing monkey business using that leverage and trying to drive some stations out of business… Thoughts? (In some ways if so, worries me more than “overcharging”)

  7. Are they dumping winter blend or are they playing the Saudi game & looking for market share with past profits?

  8. I see few non Speedway stations going up (new or remodel), most Marathon stations look 30+ years old, and a number of old time stations have gone under. Not to mention station chains acquired by Speedway.

    So it looks to me they are doing well in terms of expanding and slowly increasing market share. It seems non conventional gasoline retailers may be giving them a run for their money (Costco, Walmart and the like)

  9. Filled up for $2.03 this morning. Couldn’t hold of any longer.

  10. independent retailer

    Ed my cost on Friday was 2.13. Up 6 since then. So 2.19 today.

  11. And they’re off! Michigan going to $2.49, most of IN/Indy to $2.45 (maybe NW indiana later gets a bump?). Fill while you can!

  12. Well, Hudsonville had (3) stations below $2 for a few minutes this morning before the increase.

  13. Speedway spike under way to $2.45 in South Bend, IN. Glad I hit $2.17 last night. Was ~ $2.25 avg.

    Just across the line, Niles MI still holding at $2.15-$2.29

  14. Business as usual 🙂

  15. $2.45 places us above the national average. Welcome back to normalcy.

  16. How is that normal? Gasbuddy charts go back 11 years. In that time, our prices have been consistently above the national average for only two brief periods: Spring 2013 and Spring 2014. During the majority of the period, either we stayed below the national average, or we frequently alternated above and below the national average.

    Barely breaching the national average at the top of a spike is a non-event.

  17. OH/KY jumping to $2.499 this morning.

  18. I really dont believe in large area averages since very few people live in large areas and get to see the average all the time. But mathematically, it is about the only way to analyze. Anyway, when I look at the last 6 years on Gas Budy, Indiana’s average is generally above that of the USA, and when we are above, lots of times we are WAY above. Futher above than we generally are below when we are below the US Average. With all out taxes, I am happy if we can stay within 20 cents of the average, either way, I guess.
    You’ll probably have to copy and paste the following url.
    http://charts.gasbuddy.com/ch.gaschart?Country=Canada&Crude=f&Period=72&Areas=USA%20Average,Indiana,&Unit=US%20$/G

  19. For the umpteenth time – averages are not very useful when zone prices are into effect. A 2.19 price in Zionsville vs a 2.39 price in Carmel smooth out to 2.29 except there’s five times more people paying the 2.39 vs the 2.19 due to population density.

    Think of ‘average’ price in airline tickets. A few people pay the average, some lucky ones may get the cheap seats, and the majority end up paying the super price unless they booked on a Tuesday at 1:00 AM when the moon was waning squirrelus.

    If the ultimate result of cyclical pricing is prices that are close to average or even below it, why bother doing it? Think of the infrastructure cost to have someone decide to spike prices, communicate prices, and probably monitor compliance…

  20. Turbo: Thanks for vividly explaining one reason why I said I dont really like using Average Pricing for large areas. I didn’t take that particular reason into account. I just know that averages do not show my experiences. And it shows very few people’s real life experiences. I rarely get the opportunity to buy at the Fort Wayne average as stations setting that price are no where near where I am willing to drive. the cost would be more than the savings. Thus my experience is not the “average”

  21. Average pricing works. The problem is still that you guys don’t think they paint as grave a picture as you constantly want to portray.

    I’m using averages because they’re accurate. Deal with it.

    BTW, Timm, you are incorrect to say that “Indiana’s average is generally above that of the USA.” You cannot look at that chart and claim that there is a significant difference over that period between above-average and below-average periods. If you still want to argue that point, count the days.

  22. Averages smooth out the statistical anomalies that all of us encounter in our tiny corners of the world. Frankly, for the purpose of this board, it doesn’t matter what happens in your neighborhood. What matters is the Midwest on a macro level, and markets on a micro level.

    If the situation is so much worse in your Smallville, that’s unfortunate, but you can’t project your woes onto the larger markets. If you don’t like it, you have to move no more than one hour away to find somewhere that weathers the fluctuations better. And if that’s too much hassle for you, then just learn to deal with the anomalies without constantly complaining about them.

  23. Discussing prices at the city level – especially 90,000 people cities – is hardly ‘a tiny corner of the world’.

    Back then when my wife was earning her MS degree in Statistics, she did an internship with the university that involved looking at faculty salary data. While the university would have loved to tell the faculty members that the salary distribution is a bell curve, it was anything but. The average was very respectable, but reality – and some powerful analysis – indicated that it was the exact opposite. A whole bunch of faculty was making peanuts, a good number of tenured fat cats were making excellent money, and there was hardly anyone in between making ‘average money’. This relationship was university wide and also department wide.

    So, the university could publish ‘average’ faculty salaries that would be as descriptive of reality as your frequent proclamations that ‘we are below the national average’.

    I understand that the methodology we have for data does not lend itself to such analysis, but knowing a thing or two about statistics does make me weary of the data’s limitations.

    Discussing average on a national scale is no different. The large urban centers where people are located are generally paying a LOT more than the smaller rural areas, and there’s a LOT MORE people paying the higher price than the lower price.

    In retrospect that’s what yield management is all about. Nothing wrong with it, but do we really want our gasoline to be priced like airline tickets?

  24. My MS, also in statistics, and put to use by a major cell phone company to keep our customer experience #1….. That same degree lets me say that using AVERAGE for gasoline stats on Gas Budy is useful, and EASY. It tells us nothing more. Which stations at what price are selling the most? How far people are driving out of theur way to get the price. What the station margin actually is. All we know is X number of stations were reported to be charging Y, and their total of all the prices was Z and the AVERAGE is Z divided by Y. Not that X people paid Y, and Z people paid A1, etc. I’d really like to know the average price paid per gallon per capita. Not the average ststion asking price. From what I can tell, only a couple people on this board would know the dta equired to calculate such. And none of us even know where we could source the data. So an average of the reported station asking price (per zip, county, or city, or state, or U.S) is all we get because it is easy, cheap, and relatively useful to a degree, but tells us nothing more.

  25. The way oil is skyrocketing I’m guessing we’ll see Spot over 2 bucks and $2.79 gas next week

  26. Possible hike today (Tuesday) — going to fill up this morning.

  27. Was thinking the same thing. $2.599 for Ohio.

  28. Well, well, guess who’s had a wonderful 4th quarter last year…

    http://www.statejournal.com/story/28092181/fourth-quarter-good-for-speedway-gasoline-profits

    Marathon Petroleum, owner of the Speedway chain, said last week the profit per gallon of gasoline and other petroleum products sold at its stores was 24.51 cents per gallon in the fourth quarter, up from 13.22 cents in the final quarter of 2013. Profits for the year averaged 17.75 cents per gallon, up from 14.41 cents the year before.

    Now I realize this was in West Virginia but I would bet it’s not much different in our area.

  29. Excellent! Profit is a good thing.

    I shop at lower-priced stations myself (it’s great to have so many choices), but it’s nice to see success stories in this economy.

  30. Last night Family Express started a spike to 2.59 in La Porte County and $2.79 in Lake and Porter Counties.

  31. Mike – Kalamazoo
    Didn’t see any indication that Marathon’s reported results were for WV only. The great quarter would be no surprise since 4th quarter was almost non stop falling wholesale prices…a time when all dealers always thrive.

  32. Appears Michigan and Indy/Indiana is going to $2.59 this morning. Fill while you still can!

  33. 2.59 jump going on in Kazoo area

  34. South Bend, IN – Speedway spike to $2.59.
    Fill up for $2.24-$2.30s while you can. 3 Tue in a row,

    Niles, MI no movement yet @ $2.34-$2.39.

  35. Ohio SPIKING to $2.59.

Leave a Reply

Your email address will not be published. Required fields are marked *

Please leave these two fields as-is:

Protected by Invisible Defender. Showed 403 to 1,539,178 bad guys.

 

TheGasGame.com (c) 2017 Frontier Theme