But Breedo is somewhat relevant

Since I've been driving a 40 mile stretch of non-interstate highway repeatedly over the past few days, I've been keeping track of gas prices and am amazed. Not so much at how expensive some stations are (there are big problems in the major domestic supply and refinery region in case certain people -- GEORGE -- haven't bothered to pay attention to the news) but rather the price range.

Yesterday I got gas at a BP for $2.56/gallon and saw prices ranging from $2.53 to $2.99. Today the same BP station was at about $2.79 and the price range on the road was about $2.65 to $3.15. Additionally, the overnight price shock seems to have set off large lines at the cheaper stations (no surprise really).

What I found interesting was that Exxon and Mobil, which generally are the highest priced stations in an area tended toward the lower end today. Several generic stations had some of the highest prices.

My hypothesis (not really developed enough to be a theory) is that the lower priced stations have somehow locked into a lower supply price for at least a period longer than overnight. This can be done by long term contacts or futures market hedging. Brands such as BP and Exxon/Mobil have the additional advantage of being fully integrated companies who are essentially hedged by the fact that they are suppliers to themselves. My guess is that the generic stations with high prices have little choice but to pay overnight prices for their supply and therefore must charge enough to at least break even or choose not to sell gas at all and risk losing all their customers.

What is interesting is that the stations with presumably lower supply cost (especially the brands that are customarily premium priced) are not taking better advantage of their position by marking up their prices under the generous umbrella provided by the competition.

My best example is the main street in my town, where the generic station is priced at $3.15 while the Exxon down the street (within sight) is priced at around $2.75. To top it off (bad pun, I know), the Exxon has much longer opening hours.

Any thoughts?

Breedo is SUCH a commie

I second Mike's motion.

Good thing you're no longer exposing impressionable young minds to your shocking ignorance, Breedo.

The only other graduate of our fine high school who might possibly believe that tripe is my buddy Jay, and he is also a commie.

I Think Breedo is a Commie...

I got this from Breedo today:

IT HAS BEEN CALCULATED THAT IF NO ONE IN THE UNITED STATES AND CANADA PURCHASED A DROP OF GASOLINE FOR ONE DAY AND ALL AT THE SAME TIME, THE OIL COMPANIES WOULD CHOKE ON THEIR STOCKPILES.


AT THE SAME TIME, IT WOULD HIT THE ENTIRE INDUSTRY WITH A NET LOSS OF OVER 4.6 BILLION DOLLARS WHICH AFFECTS THE BOTTOM LINES OF THE OIL COMPANIES.

THEREFORE SEPTEMBER 1st HAS BEEN FORMALLY DECLARED "STICK IT UP THEIR BEHIND" DAY AND THE PEOPLE OF THESE TWO NATIONS SHOULD NOT BUY A SINGLE DROP OF GASOLINE THAT DAY.

THE ONLY WAY THIS CAN BE DONE IS IF YOU FORWARD THIS E-MAIL TO AS MANY PEOPLE AS YOU CAN AND AS QUICKLY AS YOU CAN TO GET THE WORD OUT.

WAITING ON THE GOVERNMENT TO STEP IN AND CONTROL THE PRICES IS NOT GOING TO HAPPEN. WHAT HAPPENED TO THE REDUCTION AND CONTROL IN PRICES THAT THE ARAB NATIONS PROMISED TWO WEEKS AGO?

REMEMBER ONE THING, NOT ONLY IS THE PRICE OF GASOLINE GOING UP BUT AT THE SAME TIME AIRLINES ARE FORCED TO RAISE THEIR PRICES, TRUCKING COMPANIES ARE FORCED TO RAISE THEIR PRICES, ALL AFFECTING PRICES ON EVERYTHING THAT IS SHIPPED (THINGS LIKE FOOD, CLOTHING, BUILDING MATERIALS, MEDICAL SUPPLIES ETC.). WHO PAYS IN THE END? WE DO!

WE CAN MAKE A DIFFERENCE. IF THEY DO NOT GET THE MESSAGE AFTER ONE DAY, WE WILL DO IT AGAIN AND AGAIN.

SO DO YOUR PART AND SPREAD THE WORD. FORWARD THIS EMAIL TO EVERYONE YOU KNOW. MARK YOUR CALENDARS AND MAKE SEPTEMBER 1ST A DAY THAT THE CITIZENS OF THE UNITED STATES AND CANADA SAY "ENOUGH IS ENOUGH"

First of all, I refuse to do anything with the Canadians. Secondly, this is STUPID, STUPID, STUPID. It ranks up there with:

"The Big-Dig was supposed to get rid of all traffic in Boston"
"We've gotten rid of Saddam, why are we paying so much for gas?"
"Reagan's gonna bring back slavery!" *

The first place to go to debunk urban myths like this is Snopes where you will, in fact, find this debunking of the above mentioned stupidity.

I was getting better, now I am especially petulant.

* Seriously, I remember hearing this in 1980 when I was in third grade at the Joyce Kilmer Elementary School in Trenton, NJ. It was an integrated, inner-city school with 700 kids -- all but 7 of whom were non-white.

I Think Breedo is Dutch...

See numbers 6, 11, and 25.

:)

I know, I shouldn't be so PICK ONE: (captious, irascible, petulant, bellicose, pugnacious, truculent). The problem is that I just can't help it. It makes me feel better if I point out other people's flaws (not saying Breedo has any flaws. He is always right. I see the error in my ways. Now where did I put that tulip?) (See #6)

Who said the following?

"I am not German. I am Dutch."

More changes in guidelines...

I got spammed again. I have since deleted the spam and it is no more. However, what I am going to do now is require all posters to have a blogger ID. Breedo, you're going to need to sign up. (It's free, you cheap bastard!)