Comment on the December 17, 2014 prediction: No hike the last two weeks of December, so the prediction was WRONG.
Thursday, January 1, 2015, 1:30PM: Happy New Year to all our readers! I appreciate that you come to read about gas prices, and I hope we can continue to help you save money during 2015. Wow, on November 24, retail gas prices were $2.99 in Standale. Today, it is $1.84, and $1.68 in Lowell. Reports are that we have some of the cheapest gas in all of the U.S. It has been remarkable. What can we expect going forward? I have to bow to history and expect to see prices move up over the next few months, as they usually do during the winter. And we are due for a price hike, because drops in retail prices are finally catching up with drops in wholesale prices. If the pre-price crash rules hold, we’ll see a jump soon to about $2.09 a gallon. Friday? — Ed A.
Seems like many stations on the south side of the Grand Rapids area just won’t let go of the $2.09 price.
But like TimmP said, people can check online for lower prices.
Right now I can go to Costco Kentwood and get regular for $1.77 plus I get 3% of from that with my executive membership,take that Speedway Ahhhhhhhahahaha.
One thing for sure about the spikes: they obfuscate the fact that Speedway has increased their margin significantly and that even when buying gas at any station at the bottom of the pricing swings, they have gotten more money out of our wallet than previously. Not saying all this is bad, but it makes this site and Gas Buddy all that more important and the need for us to be more vigilant than ever.
API new fuel tax map:
With Michigan’s 6% sales tax leading to a large drop in gasoline tax, MI (and IN) are better aligned with flat cpg Ohio.
http://www.api.org/oil-and-natural-gas-overview/industry-economics/~/media/Files/Statistics/Gasoline-Tax-Map.pdf
After so many years of being way above the US average, it has been nice to be at or below the US average the last 10 weeks or so.
Which market is that again? In Indy, there were a couple stretches of consecutive months where our average was above the national average (notably Spring 2013 and the first half of 2014).
But, those were anomalies in the past few years. The usual pattern is about a 50/50 split: spike above the national average, drop below the national average, and repeat ad nauseum.
Looking at Cincy, we go (and stay) above the national average for the entire summer, every year. It’s happened each of the last 3 summers. Other than that, we mostly ping-pong between above and below.
The price spike last week is the first one in a while where the target price did not exceed the national average.
This past summer there was 2 or three instances where Cincinnati spiked while most other parts of Ohio did not. It was like we were linked with the Northern part of Kentucky. In at least one and maybe two of THOSE spikes we went from higher than the national average on up to well above the average.
NYMEX RBOB soared 8.22 cents on “short covering” and Chicago RBOB added another 1.5 cents in the usual seasonal deterioration relative to NYMEX. 9.72 cents. Just saying!
Bearcat500…
That will be coming to an end as the winter premium on Midwest gasoline takes annual hold.
Looks like Indy/Indiana market is going up to $2.09 today courtesy of Speedway. Fill up the cans now while you still can!
Ohio is resetting to $2.09 as well. It don’t take GREEDway long to get the itch.
Just took ONE up day of more than a couple cents to get them to spike. Glad I filled up for 1.829 in Fairfield this morning.
$2.09 would be just at or just above the national average. Looks like we will be peeking out above it again. Oh well, the last almost 3 months have been great.
looks like Kazoo resetting to 1.999
Family Express leading a spike to 1.99 in NW Indiana.
South Bend area Speedways spike is underway to $2.09.
Fill up for $1.83-1.93 while you can in the SBN area.
SBN avg $1.93.
$2.09 in Fort Wayne led be Speedway and Lassus Handy Dandy. I filled up this morning for $1.83.
I saw that Midwest refinery usage was down quite a bit in the WED report from the EIA. I know some believe that is often done intentionally to jack up prices, but it doesn’t make sense to jack up prices for your competitors who are still refining product while you sit idle.
Oil goes up, Gas goes up, Price goes up, then futures go down 4%,..Its getting very weird out there,,I could see refineries changing over, or problems,… no lodgic in this move!!!! in two days its will be back down to 1,85 again,,..
Just my take on this. Spot went down 6 cents yesterday on the heels of the Wednesday jump. If Speedway is so benevolent why don’t they send out a second memo this morning stating that since the market reversed we will drop our prices to 1.95 in Ohio and $1.90 in Michigan.
We know that won’t happen and I may be thought of as naive for even having that thought but you must understand why we call them GREEDway now.
Nah, that name is still juvenile.
Spike to $1.99 in GR, MI yesterday.
Here is something I am interested in knowing…..According to Patrick’s chart (above link), Michigan taxes it’s gasoline 0.41¢ ($0.0041) more than Indiana per gallon. Why does MI spike a whole 10 cents lower than Indian? Sales taxes are not that different, either. And they normally have lots cheaper gas also.
One thing that could raise gas prices in coming weeks is another winter with near-record ice on the Great Lakes. When the lakes are iced over, good shipped by water are moved to rail, and that makes it more difficult and expensive to move oil and refined products. Some of you will recall that this happened just last winter.
Noticed that a lot of stations on my commute had dropped back down to $1.989 this afternoon. Of course, not a single Speedway among the droppers.
News flash! Cold weather causes lakes to freeze!!!!
Is carrier traffic allowed into the Great Lakes?
I meant oil tanker obviously 🙂
Not sure what the sarcasm is for, Turbo.
The length of the shipping season varies GREATLY year to year. It was widely reported that the downtime last winter was the longest ever, or close to it, because of record ice extent. We even had discussions about it on this site. Canadian oil producers were fighting grain and iron ore producers for a limited number of rail cars and tracks.
Do you not remember that?
Becky – After the spot price decrease on Thursday, spot prices rebounded on Friday….up almost 6 cents! So if Speedway did send out that drop alert, they would have had to go back up the next day. That probably would have occurred on the weekend. If they would have went up on a weekend, all of the “Greedway” haters would have gone nuts.
So in my opinion, they are not greedy. Are certain Speedway’s greedy? Certainly. But as a whole, they are just being a business. Trying to maximize profits.
That was my take on things.
🙂
“They are just being a business. Trying to maximize profits.”
Sadly, to many, that is the same thing as greed. The word has been so overused and watered down that it’s basically meaningless anymore.
20/20 hindsight.
So you’d prefer they raise and lower their prices on a daily basis?
Don’t pretend that wouldn’t set all of you off even worse than the current spike/decline cycle does…
Ren, can you honestly tell me that these 20, 30 & 40 cent spikes have always been the norm?
I can remember back in the late 1970s when gas prices at one particular gas station went up three times in one day, all told about a 14 cent 24 hour span. Infuriating, yes, but a very rare occurrence and very localized. Up until the 2000s gas prices would tick up a or down a few pennies at a time.
The saw-toothed curve on a gas price graph that you almost always defend is a relatively recent occurrence.
Ten, Indiana already has the most volatile prices in the country….
I have spent weeks on end in non Speedway states and would much rather prefer the non spike model.
As I wrote earlier there’s no point in spikes since smartphones and sites like this became popular. All Speedway does is pander to the bottom line with no concern to keeping their customers happy.
Neither one of you addressed what I said.
After much ado, the Indy average has resumed its downward trend. The recent spike raised the market average only 10 cents, from $1.94 to $2.04 — and it never exceeded the national average.
It appears that NONE of the Speedway-area markets exceeded the national average, although Cincinnati matched it for a day.
Considering that gas taxes in Ohio are 2 cents LOWER than the national average (46.4 vs 48.29 fed+state), we should NEVER meet or exceed the national average.
Chris – There may be times that our local spot prices are higher compared to the rest of the country. Thus, a reason why Ohio has to be above national average at times.
Justin – I figured that was assumed(spot prices being equal). but I guess I should have clarified my comment.
Chris – gotcha! I just saw the word “NEVER” in all caps. So I wasn’t sure.
Managed to top off for $1.85 today. Which is what I was paying before the Thursday spike at the end of last week in Indy. Anyone who actually ever paid the full $2.09 unless they absolutely had to would be the people to hate because it just encourages it.
My experience during the last spike was one of frustration. I thought there was only a minimal chance of a spike then having two mandatory meetings at work including a luncheon meeting. Checked in GasBuddy, first to alert others in advance of the GB spike bar, then to periodically to see things going downhill in a hurry. It was almost a costly ‘free’ lunch.
Lucky for me a station near me that usually lags by a full day was still at $1.87. They sell, among other things, soft drinks, munchies, “special” pipes and bongs. But as long as they bail me out with their gas prices when I need it I don’t care what else they sell.
I realize it was partly my fault with my dilemma. No matter how small, if there was any chance of a spike then fill up. In short, and I know this will disappoint Ren, don’t trust Speedway/GREEDway.
We all know retailers can have “Loss Leaders” that improve traffic and thus actually make more more $$ during a sale. Retailers wouldn’t have these sales if it didn’t pay off in the long run. So think ….. If you and I can “win” at this gas game by always buying at the lowest price in the swings, why does Speedway continue to have them? The only answer can possibly be: Because It Benefits Them. This is not to say that anybody, overall, is getting ripped off, but just like those people that never shop sales are paying for the loss price leaders, somebody in this swinging price game is paying for the rest of us that purchase only at the bottom. And I think there are fewer and fewer of us paying the price to fill up at the top of the swings.
Just in case last night’s beverages have impacted my cognitive abilities more than normal…
Ren indicated: “So you’d prefer they raise and lower their prices on a daily basis?
Don’t pretend that wouldn’t set all of you off even worse than the current spike/decline cycle does…”
And I responded by pointing out that (a) as it is, Indiana already has the most volatile gasoline prices in the nation. It’s not like we’ll be any worse. Unless of course we have micro-spikes by hour of day or my intern codes up a Raspberry Pi microcontroller to randomly change prices at the pump… In other words, Ren, we already have daily price changes.
Of course, the cynics among us would point out that the whole purpose of the futures markets is to smooth out such price changes… I know, Lol Lol Lol. Free markets at work.
(2) would we complain if prices rose and fell daily? As (1) indicates above, not any more than we would normally. It would help with pricing transparency. I drove thru the Speedway-inflicted part of Kentucky yesterday and price was a very uniform 2.15. Here we can get 1.99 easily. Same Speedway we know and love. I drive there often and generally their prices are lower than ours.
By now, as TimmP wisely pointed out, the number of people who pay full price has been reduced by quite a bit. To the point that I can only wonder how some of the stations survive… Speedway can do the right think, keep making the money they do, and stop their cyclic pricing (in other words, act like everyone else) or continue milking a diminishing number of gullible consumers while alienating a growing number of fed-up consumers. The ball is in their court.
To generalize, the gas companies and oil companies are in the same boat. They can either enjoy their last couple decades and go out in peace, or they can try to milk us for all we’re worth and ensure an even faster transition to EV’s.
The whole point is long term sustainability, not price spikes forgotten or mitigated.
I can’t speak for other markets (but I don’t know why the following should not apply to them). I have been tracking and predicting Speedway spikes in the Chicago market for quite a few years. By luck, the original post in my thread (from early 2009) shows wholesale just about what it is now, in the $1.30s. Our sales tax rate hasn’t changed and I am not aware of other tax increases at the pump. But Speedway’s spikes back then were typically 63 cents over wholesale. The last two were 92 cents and they haven’t been under 82 in the last year. The bottom of the curve has also moved up, maybe not as many cents (ie the spikes would be larger). But clearly Speedway has improved gross margins significantly in recent years. Bitch all you want about the company’s strategy, but it must be working for them.
“Ren, we already have daily price changes”
That’s not what I was talking about. I asked:
“So you’d prefer they raise and lower their prices on a daily basis?”
That is NOT what we currently have. Now they raise their prices one day, then drop for the next few days in a very predictable pattern.
The alternative suggestion was that they should be raising one day, lowering the next, raising the next, and so on to directly match the volatile gas/oil market. That is not the same thing we have now.
And, I still assert that would be MUCH more frustrating than what we have now.
C’me on, Ren. I’d rather deal with a few cents up and down, unpredictably, rather than deal with the idiotic game of ‘OMG I will need gas by Friday can I drive on fumes’??? Unless a battalion of squirrels heads Whitting’s way with evil thoughts in mind, terminal prices only go up and down by a handful of cents a day.
Also other retailers have to deal with it. You don’t see Meijer adjusting the price of bread up and down if wheat goes up and down. That’s why long term contracts exist.
But of course, long term contracts work in every other industry except the gasoline market. Even in natural gas, you don’t see Vectren playing the same game either.
Jim, someone’s got to pay for the Taj Mahal Speedway stores. Nearly every store I see is renovated, new, or in process. I can’t blame them for hiking their margins, as people don’t go inside as much as before, but a bit of transparency goes a long way. Greed only works for so long.
It could be argued that every station nationwide has increased their margin. This is only ANECDOTAL, but in looking at the last time gas was around $2.00 in Indiana, it seems the USA average was just as close to our pricing. This may be an adjustment across the board. Just saying…..and I hate paying it as much as anybody.
I’d much rather deal with having to pay a few cents more per gallon, if I couldn’t fill up on a particular morning. An extra 85 cents (.05x17gallons) is a heck of a lot easier to stomach than an extra $4.76, which was the difference in 17 gallons, pre- and post spike, at the stations near my house(1.819-2.099).