Comment on the November 30 prediction: Technically, I might not have been CORRECT, as I am not sure we got to $2.50 by November 7, but it was $2.41 in Lowell on November 8, and under $2 today, so … CORRECT-ish.
Wednesday, December 17, 2014, 2:30PM: How do you like them prices? Santa often brings gas price presents in December, but this year it is a big red bag of lower prices. But let’s look at some history. I re-set my spreadsheets on May 1 each year (due to the academic calendar), and here are the dates of the lowest prices I recorded the past several years in the May 1-April 30 period:
2013-14: December 4, $3.03
2012-13: December 19, $3.09
2011-12: December 20, $3.12
2010-11: July 13, $2.58 ($2.85 in December, and higher in January)
2009-10: May 4, $2.13 ($2.32 in December, and higher in January)
The last three years, retail prices bottomed out in December, and then rose during the first few months of the new year. This dynamic also occurred earlier in the last decade, and we saw a short-term low in December 2009 and 2010. There are a number of reasons for this, including the different way gas is manufactured for the summer months, but the point today is that these sub-$2 prices are probably not going to last for long. Today, energy prices are rising for the first time in a while (see, for example, the price of UGA, the ETF for gasoline), and that usually means that the retailers will look to re-set their prices. So, I’m expecting a price hike by the end of the week. $2.39? After Christmas, I expect we’ll start to see prices climbing slowly through winter, as it usually does. — Ed A.
“So, I’m expecting a price hike by the end of the week.”
It’s Wednesday afternoon and Speedway usually does not reset prices on Friday though Sunday, so that leaves only Thursday as a possible day for prices to go up this week. If they do go up Thursday (tomorrow), then my prediction from December 8 will be correct: http://www.thegasgame.com/2014/11/30/oil-prices-crash-gas-prices-next/comment-page-1/#comment-52035
If they don’t reset tomorrow, that takes us into next week, the week of Xmas. Monday and Tuesday are probably the only days next week Speedway would reset.
In the Kalamazoo area, the lowest price is currently $2.129 at the Admiral on Westnedge in Portage, followed by $2.139 at the new Costco in Oshtemo Township and three stations near it. I got gas this morning for $2.179, but then that station fell to $2.139 this afternoon.
Over the past 14 days, Kalamazoo prices have fallen 46¢, a 17.7% drop.
I see that segments of the Buckeye Pipeline system in the Midwest are in apportionment next month. Maybe short supplies coming to some terminals soon?
Here in IL we are nearly 15 cents Speedway average price away from a price hike…almost 100% certain to get us past this coming weekend. As of tonight, Speedway’s reset price would be $2.469, which just happens to be the current average across their stations. Barring any further rise in spot price after today, we just might make it past Christmas here which as pointed out in the original post would be late for the annual bottom. But these aren’t normal times and I’m not yet sure OPEC’s failure to restrict output has run it’s course of effecting the market. I hope.
Tuebor…interesting about the pipeline allocation. Haven’t seen a new January 30 day forecast, but perhaps there’s expectations of a cold snap and more demand for heating oil?
Ohio’s still 35 cents above the spike line. Can’t see us spiking before Christmas. Not unless spot prices really take off in the next few days.
Nailing a prediction after such a long decline in prices is always a bit more challenging. We shall see what happens.
No increase today in Michigan.
The place where I got gas yesterday morning for $2.179 fell to $2.139 yesterday afternoon and is $2.099 today.
The lowest reported price in the Kalamazoo area currently is $2.089 at 4 locations, two of them in Portage near the airport plus the new Costco in Oshtemo Township.
I imagine the Kalamazoo area will see its first $1.999 price within 24 hours, that is sometime Friday afternoon.
Assuming prices do reach $1.999 tomorrow at some locations, I’ll be surprised if there is not a reset on Monday or Tuesday. If they don’t go up on Monday or Tuesday, they probably won’t have a chance (because of Xmas) until the following Monday/Tuesday, which is December 29/30.
Crude and wholesale feel near the end of the day to just below yesterday’s close. We should make it through this weekend with a reset to $2.39 or $2.49 seemingly imminent, courtesy of Greedway.
U Of Minnesota Study Finds Ethanol Worse For Air Quality Than Gasoline
“One of the most surprising findings is that ethanol might actually be worse for air quality than conventional gasoline fueled transportation.
Researchers looked not only at the end result at the tailpipes but also took into account the full cycle of energy production. For instance, the authors calculated the entire pollutant stream, meaning everything generated from the growing of the corn to the process used to turn it into ethanol.”
“Their research actually finds that the pollutants from both ethanol and gasoline are nearly equal at the tailpipe.”
“In fact, the study finds that driving an electric car is actually worse than gasoline if the power used to recharge the batteries is generated from coal.”
http://minnesota.cbslocal.com/2014/12/17/u-of-m-study-finds-ethanol-worse-for-air-quality-than-gasoline/
I’m sure Speedway will “release the squirrels” before Santa loads up his sleigh next week.
One last spike before the year closes out!
I’m sure you’re right, Chris!!
If GasBuddy is to be believed, the Speedway on M-96 in downtown Comstock Township is the first Kalamazoo County retailer to fall to $1.999. This was reported 4 hours ago, but Speedway’s website still says $2.179 for that station. The second lowest price in Kalamazoo County is $2.019 at a number of locations.
Since people will inevitably complain about the ‘greed’ behind next week’s probable ‘Christmas spike’, I’m going to go ahead and point out that the Speedway states are currently the 5th, 7th and 9th cheapest in the country, which are much better than where these state’s gas taxes suggest that their prices should rank. I do think a spike will happen on Monday and Tuesday, but Ohio, Indiana and Michigan will most likely still be below the national average even after the spike.
*Monday or Tuesday
Lamby – Speedway states are also currently enjoying some of the LOWEST spot prices in the country, rendering that argument moot. Chicago spot is 20 cents below NYH RBOB right now.
ChrisDG74…
Good point. Chicago spot’s “Below NYMEX” usually bottoms out about now and turns into an “above NYMEX” in January and keeps rising into March. Of course maybe this year will be different.
Either way, all cans and all cars get filled Monday. JIC
I don’t doubt we’ll see a spike Monday/Tuesday. I just don’t think the spread in Ohio justifies it (90 cents).
“If GasBuddy is to be believed, the Speedway on M-96 in downtown Comstock Township is the first Kalamazoo County retailer to fall to $1.999. This was reported 4 hours ago, but Speedway’s website still says $2.179 for that station. The second lowest price in Kalamazoo County is $2.019 at a number of locations.”
That Comstock Township price turned out to be incorrect. Later that (Friday) evening, that station disappeared from the lowest prices list and was still at $2.179 on Speedway’s website.
However, Kalamazoo County prices did begin to go below $2 on Saturday morning, apparently lead by the new leaders of Costco in Oshtemo Township and Sam’s Club in Portage. The Costco store is new (opened Wednesday, November 12) while the existing Sam’s Club recently added a gas station. There are three Speedways near that Costco and they match Costco’s decreases, resulting in a new dynamic of the Stadium Dr. area having among the lowest prices in Kalamazoo County.
Currently, the lowest reported prices in Kalamazoo County are $1.979 at Sam’s Club and the BP at U.S. 131 in Alamo Township. $1.979 has been available in nearby Plainwell/Otsego (Allegan County) since yesterday morning, so prices haven’t moved downward a whole lot since yesterday (Saturday) morning. The Kalamazoo average is currently $2.077.
In the Grand Rapids area, $1.989 is the bottom price, except for 7 stations in Lowell at $1.919–$1.949 (2 of these stations are Admirals). The Grand Rapids average is currently $2.102.
The lowest currently reported prices in Michigan are $1.889 at 3 stations in Grand Haven, 2 in Spring Lake (both Admiral), and 1 in South Haven. The Michigan average is currently $2.242.
Indiana has the 5th lowest average in the nation ($2.210). Ohio is at number 6 ($2.211) and Michigan is in 10th.
That UGA:US electronically traded fund finished up 3.48% on Friday at $36.83, its highest close since December 12.
All petroleum commodities futures finished up on Friday:
* Crude Oil (WTI) – $57.13 – up 5.10%
* RBOB Gasoline – $155.95 – up 2.11%
My cost today in west Mi is 2.12. Buy cheap while you can.
Thanks for the update Independent Retailer (I remember you posting on Channel 3’s gasoline message board around 2000-2001). It is nice to get a hard number. Can you share what price you are currently charging credit card users for regular unleaded?
As of the moment, I don’t see any Speedway stations going up in Michigan. This highest Speedway price in Michigan is $2.169 at 11 locations (reported within the past 4 hours). The lowest credit card price (among all brands) in the Kalamazoo area ($2.041 average) has fallen to $1.959 at Costco.
Excepting Lowell, the lowest price in the Grand Rapids area ($2.074) is $1.979 at 6 stations in Sparta and Cedar Springs.
The Michigan average is currently $2.193.
All petroleum futures are down around 1% this morning. UGA:US is currently down 2.05%.
2.19
I just filled up everything I have for $2.04 in Lansing. I got 35 gallons for $1.84 thanks to a 20 cent Kroger discount. This particular Kroger’s prices have fallen from $2.26 on Saturday evening, to $2.15 Sunday evening, to $2.04 this morning.
Patrick tweeted this at 3:29: “So #GulfCoast spot gasoline just dropped within 10c/gal of 99c/gal”
The Kalamazoo average has fallen to $2.028 and the lowest price is $1.939 at Bob & Kay’s Shell in Oshtemo Township. Over the past month, the Kalamazoo average is down 79.7 cents.
Will we get a reset tomorrow? Friday? Next week Monday?
Spot prices dropped another 6+ cents today in Chicago, where spot gas is under $1.30 now.
Costco here in South Bend/Mishawaka now $1.99! Niles, MI has many stations at $1.97!
Well, I sure was WRONG this time.
Merry Christmas, all!
No problem, Ed. At least you offer actual predictions based on informed speculation. And this time the missed forecast worked out in everybody’s favor.
Unfortunately, unlike you, a few others won’t admit that they were wrong about what they were “sure” would happen. And we can look forward to another year of cynical stabs in the dark from the doom/gloom/conspiracy crowd.
Merry Christmas to you and everybody else here, regardless of their prediction abilities. 🙂
north side of grand rapids went too 1.99 at 6pm
Ren, thanks for the “Merry Christmas” instead of the more generic “Happy Holidays” It is really appreciated. I still filled up all the vehicles, it was great to see $2.00 gas again, if only short lived. And all the Christmas visiting can be done on a full tank.
Same to you Ren. Know we don’t have the same views on most things on here, but there is never anything meant by it. Merry Christmas to you and yours also. And like Ed, so glad I’ve been wrong so far with what I thought would have happened by now.
Was just looking at the gas price map. Way to much green in Indiana & Michigan. I’m sure Speedway and Family Express are working on a cure.
Bill – Indiana
Especially Michigan, with higher taxes I believe. HArd to believe some markets the average has dropped below $2 in Michigan. Payback is coming.
Jim & Bill, I am with you on the green for Michiana, and possible payback coming. But I‘d rather think of the current green as our turn, FINALLY! Soon, we‘ll be perpetually in the tan with a few short strolls into the yellow, and the very infrequent several hours of faint green. Such is life in Michiana, where gas sales tax is collected and Speedway marketing strategy form the perfect storm. But I’ll take the price as long as the Saudis want to give it to us.
TimmP
I’ll take the price until the low cost per barrel of oil puts more fracking on hold (and some frackers out of business). That’s the Saudi end-game. The good news for us is that when the oil prices rise, it will again be profitable to frack, so whoever is left will restart, which should temper the rate of price rise. Of course, with all of the speculation in commodities, we are more likely to get a cost spike of panic when people realize there is less fracking. So still the price is anyone’s guess.
I was grateful to be wrong this time (yep, big enough to admit it because it was a holiday and it was – by me – expected). Am looking forward to filling up for $1.82 @ Cedar Springs Meijer (with a Meijer credit card) today.
Gas Buddy currently shows the Michigan average as RISING, from an average of $2.113.
The Kalamazoo average is shown as $1.966 and STABLE. The lowest currently reported price in the Kalamazoo area is $1.839 at Sam’s Club in Portage and Costco in Oshtemo Township (plus two Speedways and a Shell near that Costco).
Will we get a reset on Monday (December 29)?
On Xmas Eve, Patrick tweeted: “After seeing @EIAgov data, first thought: could see oil in the $40s. Overall supply 76 million barrels higher vs year ago. Incredible.”
$1.85 our cheapest North of town and $2.06 the avg.
Our average over spot is to the point where any decline might spur a GREEDway reset. It has been one month and two days since our last spike. Up to now they have shown remarkable restraint but then again they haven’t been in a position to do so.
Anyone else think that for their own sake OPEC had an unfortunate sense of timing. With us having a significant oil supply glut compounded by the US being over 4 months away from the driving season. We will not shed that glut in the short term. Does it work against them to have a prolonged oversupply in the US and have the weaker OPEC partners suffer or does it work for them that our oil production is slowed or worse the next several months. I guess we will find out soon enough.
“because it was a holiday and it was – by me – expected”
I think it’s been proven beyond a reasonable doubt that holidays do NOT directly cause price spikes. When spikes are occurring on a nearly weekly basis, of course many of them will occur by chance within a few days of a driving holiday. But there are numerous examples like this Christmas when they don’t happen at all.
There was a time many years ago when one could rely on holiday price spikes, but it’s simply not how things work today. It’s one thing to know something, but the real challenge is to un-know it when it’s no longer true.
The UGA:US electronically traded fund closed Friday (12/26) at $35.08, its lowest level this year.
The Michigan spike line from Tuesday (12/23) is $1.9947. The current Michigan GasBuddy average is $2.081, 8.63¢ above Tuesday’s spike line.
So, it looks like Michigan may get to the new year without a reset.
Selling gas 20 cents/gallon below cost in West Michigan
Ren, now that spikes are NOT occurring on a weekly basis, are they burning the furniture and copier paper over at Speedway HQ? in other words, why are they NOT spiking these days?
The Hoi Polloi’s objection to, and skepticism of, spikes is not whether they occur on the weekends or on holidays or what not, but that they occur at all. We’ve gone six weeks or more without a spike and we’ll likely go another few days without one. The world has not ended.
I have no problem paying for gas, but I do have a problem making a game out of it. A game that at least in my case Speedway is not winning since 90% or more of my meager gasoline purchases are made at Costco…
$1.58 in Crawfordsville. Might be time to fill up my big 1,500 gallon tanker truck!!
If I was a betting man, I’d bet my house that Speedway will spike tomorrow.
Turbo, the answer is quite simple: Speedway and others are still making a profit off each gallon of gas. Hence, no spike.
Was that a trick question?
And, by the way, I still hear all SORTS of skepticism that “gas prices always spike for the holidays.” In fact, it happened in this very comments section.
I liked your logic before Ren, or GREEDways. Let’s spike a lot of times so they really can’t tell we’re spiking because of the holiday. lol
Well, why not manage the sale rice so that they ALWAYS make a profit and don’t have to engage in meaningless price acrobatics to aggravate the consumers?
That is the trick question.
Turbo46032…
Simple answer: this results in higher average profits for Speedway than other pricing strategies. And for some of us it results in a LOWER average price paid, by paying attention.
South Bend avg just dropped below $2 to 1.998!
Costco and Admiral leading the way at $1.88.
Just over the state line in Niles, MI, Admiral & WMT at $1.85.
Jim gets it.