Wednesday, May 6, 2009, 7:30 AM: Another price hike yesterday — to $2.29 — and it starting to feel a bit like the first half of 2008. I write this because wholesale prices shot up 20 cents over the past week, so retail prices have followed, and we have our highest prices of the year. Last year, wholesale prices seemed correlated to the stock market, and if you have been following, stocks have been doing better lately. I also understand there are some short-term supply issues right now connected to switching over to the summer gas formulation. I don’t anticipate another hike this week, but Patrick’s $2.50 prediction for this summer is reasonable. I don’t want to think that far ahead.
Tag: price hike
Price jump soon (today?) to $2.19?
Looking at morning numbers briefly this morning before an interview on WOOD AM1300, I think I might have to announce that I’m expecting a price hike soon to $2.19! A quick look at closing prices on the market from late last week and yesterday:
Thursday close $1.42
Friday close $1.47
Monday close $1.54
As you can see, wholesale prices are up a whopping 12-cents since just Thursday! While I believe Speedway’s price hike Friday to $2.15 was over done to provide more profit for their Saturday/Sunday Speedy Rewards discount, I now believe that they will raise prices again to keep up with wholesale cost.
Another contributing factor is the switchover to Summer blended gasoline which costs more to make. Refiners were required starting Friday (May 1) to only sell Summer blended fuel after that time. Retailers have until June 1 to make sure they have it in their tanks.
At last check, the Chicago market is suffering a huge Chicago Premium for RBOB gasoline (ethanol blended gasoline, which nearly all retailers sell). The Chicago region was paying nearly 18-cents more per gallon than any other region. Chicago is currently trading RBOB Unleaded at a 21-cent PER GALLON premium to NYMEX pricing.
I’m led to believe we’ll see a jump to between $2.15-$2.25. I’ll pick $2.19.
Gasoline demand is starting to rise so don’t think this is a shock to see higher gas prices. At least we’re not paying $3 or $4/gallon!
Patrick
Speedway raises prices day after huge drop in wholesale prices
Let me just say how surprised I am that Speedway raised prices today. I think everyone should be able to see how out-of-line this price hike was as it stunned many.
Wholesale gasoline prices closed down a good amount yesterday, so why did Speedway raise prices? Good question.
And while we’re on the topic, Speedway is crippling its Speedy Rewards program effective May 1. Did something happen? Loss of 5-cent Speedway Credit Card discount on April 1, Speedy Rewards points “adjustments” May 1, what’s next? Oh well, guess I’ll have to find a new place to get fuel.
There was no reason for prices rising today except to increase profit margin (especially with the huge loss on the market yesterday)!
Patrick
Hike tomorrow? Not sure, be on lookout
With prices falling locally and wholesale prices remaining relatively flat, we’re close to a price hike.
I am led to believe that odds are against a hike, but it’s very close. If you need gas and can find it on your next trip out for less than $2/gal, I would definitely fill up. I’m nearing “E” and need gas soon, but I’ll probably wait until Monday.
The DOE report released today was excellent, and I don’t see any reason why prices should rally in the future. I expect that crude prices slowly fall over the next few weeks unless the economy makes some remarkable comeback.
Patrick
“Chicago Discount” Clouds Gas Game Crystal Ball
Comment on the April 2 prediction: We didn’t get a hike until April 7, and it was only up to $2.05, so the prediction was WRONG.
Sunday, April 12, 2009, 5:15 PM: From February 27 until now, there have been five price hike days, and each time, the hike has been up to a price that was less than I would predict based on either NYMEX or AXXIS numbers. Patrick’s sources confirm that a “Chicago Discount” has been operational lately, which is surprising this time of year. If anything, the switchover from “winter gas” to “summer gas” usually leads to shortages and price spikes. Perhaps this is one (welcome) consequence of the recession.
If NYMEX is to be believed, the 0-cent margin price is $1.99 this weekend, but I don’t have much confidence in the numbers right now, because the 0-cent price could be as low as $1.85 due to the Discount. With retail prices pretty much in the $1.95-$2.05 range right now, there is no obvious prediction to make, so I won’t.
Price hike inevitable Monday or Tuesday… $2.09? $2.15?
After some mixed news last week about oil and gasoline inventories, prices has slowly risen. While we should all be happy prices are still WELL below their year-ago levels, I will let you know that we should see a price hike Monday or Tuesday to between $2.09-$2.15.
While I personally believe crude prices should keep bouncing around $40 to $55, I am led to believe that it will take a few weeks for them to bump to my next “prediction” of $55-$65 starting in early May.
Fill up before prices rise as early as tomorrow!
