Month: June 2017

It has been a peculiar summer so far, so let’s fill up on Wednesday

Comment on the June 11 prediction:  CORRECT as prices slipped lower for the next 11 days, but WRONG on missing the hike last Thursday.

Tuesday, June 27, 2017, 3:00PM:  But it wasn’t much of a hike, and in some places, they’ve given it all back since Friday.  You can buy gas for $2.17 in Wyoming right now, but still at $2.39 in many other places, such as Dorr.  You know, we’ve had some odd behavior for two months now with odd hikes and a 20% drop in oil prices not corresponding to a 20% drop in wholesale or retail gas prices, even with a time lag.  So, let’s predict some more odd behavior.  In Wyoming, we are in price-hike territory already, but not in Dorr.  And with a long holiday weekend coming up, I can envision Big Red getting all the prices back in line in the next two days.  Back to $2.39, or will they go a little higher? -EA

Cheap Gas in Belding

June 11, 2017, 7:00PM:  This spring, we’ve been commenting on what appears to be more aggressive retail pricing of gasoline, with more frequent price resets and higher margins.  That 0-cent margin price still exists, though, and when Big Red takes its foot off the accelerator, you start to see wide variation of prices in the region, like we are seeing this weekend.  As I write this, you can get gas for $2.10 in Belding (northeast of Grand Rapids), but a few miles away, prices are in the $2.40’s and even $2.50’s in some places in GR.  That’s because of the fat margins of those in the 2.40’s right now, and the slim-to-none margins in Belding.  With competition, margins shrink.

Going forward, I see no reason for a price reset any time soon, except maybe in Belding.  And, although we don’t tend to engage in long term predictions here on The Gas Game, this tweet from an economic professor suggests significantly higher oil prices are on their way, and gas prices will follow.  Right now, I don’t believe it, but take a look! –Ed A. (c) 2017 Frontier Theme