Tuesday, April 15, 2014, 9:00PM: Despite the fact that ethanol prices are back under control, Monday’s price hike had the same flavor as other recent hikes. That means that the price to retailers still has an ethanol premium included, or those red colored stations are pricing gas pretending that ethanol is still a problem and hoping we just live with it. A clue that it may be the latter was the curious behavior in prices along Lake Michigan Drive the past two days. While prices in Grand Rapids were popping to $3.89 everywhere, the Family Fare at Collindale held in the low $3.60’s, and Speedway was forced to follow. Tuesday morning, they still had those prices, as did the Marathon down the road in Standale. GoLo there was at $3.79, though, and at 3PM today as I drove by, Speedway and Marathon decided to try $3.85. They’ll be back to at $3.79 or lower tomorrow, and we see this sort of behavior when there is a lot of room for prices to move, as I think there is right now. I am calculating a price to retailers of about $3.54 right now. The easy prediction recently has been “expect another hike”, although my math models don’t quite say that. In these times, we sit back and watch. — Ed A.
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Why We Are Here
We enjoy predicting and trying to further our knowledge in the gasoline and oil industry. Our ultimate goal is to "win" the game of price hikes and to accurately predict hikes.
Current Contributors:
Ed A.: ab...@gvsu.edu
Craig P.: cr...@paull.net
Tim S.: ts...@gmail.com
Bill E.: pa...@yahoo.com
The name of the site is based off an essay Ed wrote for the Grand Rapids Press titled "The Gas Game". The current website was established later by Patrick DeHaan after he and Ed predicted gas price hikes on GasBuddy's website GrandRapidsGasPrices.com, as well as Ed’s personal web page.
Note: To be precise, add 9/10 of a cent to all prices described on this web page.
Current Contributors:
Ed A.: ab...@gvsu.edu
Craig P.: cr...@paull.net
Tim S.: ts...@gmail.com
Bill E.: pa...@yahoo.com
The name of the site is based off an essay Ed wrote for the Grand Rapids Press titled "The Gas Game". The current website was established later by Patrick DeHaan after he and Ed predicted gas price hikes on GasBuddy's website GrandRapidsGasPrices.com, as well as Ed’s personal web page.
Note: To be precise, add 9/10 of a cent to all prices described on this web page.
Greedway needs to be investigated. Baseless price increases should be illegal. It sure seems like they have a goal of $3.89 gas no matter the true cost. I will not step foot in that place.
So now we need to do our part — buy gas at those stations with the more competitive prices, and share our knowledge with others so that they can do the same.
If people are paying the higher margin, there’s no incentive for those stations to lower their prices. We need to use this competition to our benefit. It’s that simple.
Speedway leads the charge to $4 !
This morning about 90% of the stations on the Route 30 corridor (I-65 to the Illinois state line)raised prices to $4. There were a few stations left at $3.90 but not many. Looks like the next spike will take us to $4.25. I wonder what the tipping point will be this time ? Have consumers become numb to the pricing ?
There’s no tipping point any more. Part of the Speedway spiking could be just a plot to find out what a tipping point, if any, is.
This late in the game it could be $6 for all I care, those who need to go to work will go to work, the rest will be staying home. Remember the premise here is that there’s more money to be made in $5 gasoline than in $4 gasoline regardless of volume. Volume won’t drop nearly as much as price will rise, QED.
Those who observed what’s going on in the last year could see it coming. There was a change in behavior, more frequent spikes, etc. All we need for $5 gas now (not 4) is crude around 110-115 due to some ‘crisis’ and we’re done.
A couple weeks ago everyone blamed the railroads for ethanol and thus for gasoline. Well well…
On Monday evening, with some retailers at 3.85 (curiously not all Speedway stations) and others in the $3.55 range, I actually saw a Shell station drop its price to $3.49. No doubt it has joined the others in the $3.85 range by now, though. This was in Greenwood, Indiana.
Thanks to this site and GasBuddy, I usually “win” at the game and end up paying on the lower end. I make it a point to only buy gas from Speedway when I’m sure they aren’t making a profit off it. I also make sure I get their free items every month, whether or not I even like them (I just give away the energy drinks and such). Just my little way of sticking it (back) to them!
Citgo refinery in Lemont was down last week. Wood River is down now.
Monday night, the Speedway on West River Drive & Division in Comstock Park (near SB US-131 entrance/exit) was $3.57 and I did not see that station go over $3.79
Other stations in the area were $3.84-$3.89 Monday & Tuesday, some are down to $3.79 today while others have not moved.
The profit price cycle is changing character, I think. I cannot make sense of it yet but it seems changed.
Now that squirrels are on spring break and rail is flowing, our trusted standby is back… Refinery down times.
There is definitely a trend shift here. It almost seems like $3.50 is the new $3.00 and $3.89 is the new $3.50.
Crude is now at 104$ and that of course is extra cash for the Rissians – pity they didn’t think of this in the 1990’s.
Am I crazy, or am I actually seeing an increase in margin for stations over what it was last year? It seems like last year, the calculated ZERO margin for stations would hit negative or 0 cents before a spike would hit. This spring, it seems like it hits 15 to 20 cents, then a spike.
Ed has stated that the latest ethanol volatility is not currently being factored in to his equations. That could be the unknown variable that affects the margin calculations.
See his April 4 post for details.
GREEDway is resetting Ohio gas prices to $3.79 today. Another Speedy Reward??
Spiked from mid $3.60s to $3.85 on that last spike. Now a few back down to $3.65 today here in South Bend, IN.
So much for no spike in Ohio. $3.799, because they can. Everyone else is falling over themselves raising THEIR price to match.
In watching my early indicator, Fort Wayne’s average price dropped below Indiana’s state average just after midnight. Historically, that would indicate another hike no later than Tuesday, and probably earlier. I could be wrong, but this early (2 to 3 day warning) indicator has not been wrong at all in the last 9 months.
Yesterday’s spike price puts Ohio 17.5 cents above the national average. Pre-spike, we were 2 cents BELOW. Seems that as soon as we get a penny(or two) below the national average, GREEDway cranks up the old spike machine.
In listening to WSB in Atlanta, they were omplaining about a 42 cent price jump in the last 10 weeks. They need to be in the midwest where we get close to that in 10 minutes.
Speedway spiking in South Bend, IN to $3.89 today. Plenty of non-Speedways in the low $3.60s for now & 2 down to $3.59.