Comment on the July 19 prediction: Prices rose twice last week, to $2.45 on 7/21 and then to $2.55 on 7/23. Take the average, and you pretty much have my CORRECT prediction.
Thursday, July 30, 2009, 4:00PM: Uh oh. NYMEX gas prices are up 13 cents a gallon today! Using my formula, a price re-set would be in the range of $2.59-$2.64. I expect this will be the new price on Friday. — Ed Aboufadel
Comment on my June 23 posting: Prices have continued to fall for a week, so the prediction was CORRECT.
Tuesday, June 30, 2009, 9:30PM: I just want to share what I am looking at right now. The moderate jump in wholesale prices this week has given us a 0-cent margin price of about $2.45 and a 20-cent margin price near $2.69. Yet, this is also the range of prices right now in the area, with gas below $2.50 in Allendale and at $2.69 in Ada and Lowell. So, we could get a price hike before Independence Day to $2.69, but some places wouldn’t notice. Or, the stations at $2.69 could drop their prices while stations near $2.49 will probably keep their prices constant. So, I don’t feel like a prediction is warranted, but I hope readers understand the underlying dynamic right now. — Ed Aboufadel
After yesterday’s spike up to $2.85 we saw the bottom completely drop out of the Chicago market, and wholesale gas jump 13 cents to $2.29. This was for delivery to the Wolverine Pipeline, which covers the lower part of Michigan. With Speedway jumping up to $2.85 before this climb, and the price being specifically set for Michigan, $3 has just jumped into the realm of possibility for Michigan drivers.
And it isn’t just me saying this. Some guy calling himself a petroleum analyst for GasBuddy.com, Patrick DeHaan, also believes this is so. He said so on WOOD-TV 8.
So, I’d hate to say this, but $2.85 or less is looking pretty good come tomorrow at 9:30, as we may see Speedway break the $3 barrier, or come close at $2.99. Hold on to your hats, the pain hasn’t stopped, yet.
I am not sure what this means for Indiana and Ohio. It is quite possible we, too shall see a spike tomorrow as well. But it is hard to tell where we are getting our gas from. NY Harbor, Group 3 and Gulf Coast gas prices are almost 35 cents lower than the Chicago spot, and I wouldn’t be surprised if gas from one of those areas makes its way to this area. The price in this area will be lower, but to what extent? A spike is a possibility, but I’m thinking it would be much like last week, where we will ride out the last spike. But jumping into the mid to upper $2.80s wouldn’t shock me at all, either.
With wholesale gas prices going up again today, we are at near break even margins here in Indiana (with a little breathing room in Michigan). Prices here in the PADD2 area are now putting us in the red when it comes to national prices on the GasBuddy color map. Today it went up due to yet another DOE report where we are at a low 47.4 million barrels of gas, down from over 52 million barrels a couple weeks ago. There has to be something wrong with the supply, but for now I can only give you the bad news of higher prices, not the reason for them.
There is a possibility of a spike tomorrow. Since it would be the second in a week, something that usually doesn’t happen, there is also the possibility it won’t happen. But be on the lookout for prices going into the $2.70s, and possibly the low $2.80s if it does go.
Wednesday, May 27, 2009: I am happy to announce a new writer to join me on this blog. Indianapolis resident Bill Eby is going to start posting on The Gas Game, providing a point-of-view from the Hoosier state. As we have seen, gas prices in Michigan, Indiana, and Ohio are closely tied together, and Bill has been an effective predictor of price hikes with his posts on Indianapolis, Michigan, and Indiana Gas Buddy sites, under the name “Paxman”. Bill works in the telecommunications industry. Welcome, Bill!
I want to publicly congratulate Patrick on this step forward in his career. He had been keeping me abreast of his conversations with GasBuddy, and I was anticipating when this day will come.
When Patrick joined up with me a few years ago, The Gas Game was just a hobby of mine. Some of you may recall my article in the Grand Rapids Press in 2002, along with my web site at gvsu.edu, as examples of this hobby. With Patrick’s hard work, thegasgame.com became something special, with a great logo; RSS, reader comments and other tools to expand access; and several other obvious and hidden enhancements that have increased the visibility of this site. Thank you, Patrick, for all the work you’ve done on this site.
Patrick and I have gone through a lot with this site the past few years. The explosion of gas prices from below $2 to $4.25 brought us a lot of attention, and the dizzying drop this past year back below $1.50 has been amazing, too. Due to all the news about gas prices the past few years, the site has been noted in media from Chicago to Washington, DC.
I don’t want to make it sound like we’re done now. I will continue to post regularly to the site, making my comments and predictions about gas prices and possible hikes. But with Patrick moving to Gas Buddy, postings on this site will be less frequent, and, as you may have noticed, I tend to focus on connecting the price of the futures to retail prices and pay less attention to refinery issues and Speedway rewards programs. My quiet study of diesel continues, and I expect to have something intelligent to say about diesel pricing before the end of the year. And, perhaps I’ll get another featured writer for the site.
Ed