January 10, 2009, 12:00 PM: I was in Washington, DC much of the week, but no one wanted to talk to me about gas prices. Actually, I was there for the annual mathematics meeting. Yes, we actually have annual meetings. Prices over $2 were standard in the DC area, and I watched the hike to $1.99 in Michigan via the Internet. The three recent hikes, starting 12/29, reflect a stunning rally in NYMEX, from 80 cents a gallon on Christmas Eve to $1.20 or so on January 5.
The three recent hikes provide a chance to re-calibrate my Excel spreadsheet. It looks like the AXXIS price is a pretty good proxy for wholesale prices in west Michigan right now, using a margin in my formula in the range of 21 to 25 cents. If that is the case, the 0-cent margin price is in the low $1.80’s, as fmcman reports on GrandRapidsGasPrices.com. And, lo and behold, retail prices in the area are from the low $1.80’s to $1.99. So, I expect prices to drop slowly over the next several days, which would set us up for a price re-set on Thursday. This feels like weather forecasting, though, looking five days ahead, because we don’t know what is going to happen in trading on Monday and Tuesday.
I’ve been hitting your website for a little over a year now…and just wanted to say thanks for all your hard work! Really enjoy reading your site.
Thanks, Brian!